Egyptian shares surged to the highest level in almost six months after Qatar’s QNB Group (QNBK) expressed interest in buying a majority stake in Societe Generale (GLE) SA’s Cairo unit.
National Societe Generale Bank SAE (NSGB), Egypt’s biggest publicly traded lender after Commercial International Bank Egypt SAE (COMI), advanced the most since November 2008. CIB rose to the highest since May last year. The benchmark EGX 30 Index (EGX30) climbed 1.7 percent to 5,424.79, the highest since March 7, at the close in Cairo. Qatar’s measure fell 0.3 percent, while the Bloomberg GCC 200 Index lost 0.6 percent.
Talks for QNB to buy a stake from Paris-based Societe Generale, which owns 77.2 percent of the Cairo-based bank, were at an early stage, NSGB said after markets closed on Aug. 30. Societe Generale’s stake was valued at about 10.8 billion Egyptian pounds ($1.77 billion) based on NSGB’s closing price last week. A request to conduct due diligence was presented to Egypt’s central bank, NSGB said.
“Local investors are expecting a favorable valuation by QNB for NSGB,” said Teymour El-Derini, Cairo-based director of Middle East and North Africa sales trading at Naeem Brokerage. “It’s a boost to sentiment, which is looking up for the rest of the year.”
World’s Top Performer
Egypt’s benchmark gauge has surged almost 50 percent this year, making it the world’s best-performing gauge among the 92 tracked by Bloomberg. NSGB rose 10 percent to 34.77 pounds, the highest since Jan. 27, 2011, the last day of trading on the Egyptian Exchange before a two-month suspension due to the popular uprising that ousted Hosni Mubarak. CIB added 5 percent to 31.60 pounds.
QNB shares fell 0.4 percent to 133.6 riyals in Doha. Elsewhere, in the six-nation Gulf Cooperation Council, Dubai’s DFM General Index slipped 0.1 percent and Abu Dhabi’s measure fell 0.2 percent. Bahrain’s index dropped 0.8 percent, Kuwait’s measure advanced 0.6 percent and Saudi Arabia’s Tadawul All Share Index lost 0.6 percent.
Israel’s TA-25 Index retreated 0.5 percent. The yield on the 5.5 percent Mimshal Shiklit bonds maturing in January 2022 fell three basis points, or 0.03 percentage point, to 4.19 percent at the close in Tel Aviv. The yield jumped 28 basis points in August.
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