Emirates NBD has received approval to conduct due diligence on acquiring Banque du Caire, valued at over USD 1 billion. The acquisition is part of Egypt’s strategy to privatize state assets under IMF economic reforms. Prime Minister Mostafa Madbouly aims to divest shares in state companies by 2025, enhancing economic productivity and reducing public debt.
Emirates National Bank of Dubai (NBD) has received approval from the Central Bank of Egypt to conduct due diligence on a proposed acquisition of Banque du Caire. This transaction is projected to surpass USD 1 billion (EGP 50 billion), according to sources familiar with the negotiations, as reported by Asharq Business. The Egyptian government is reportedly keen to expedite the process, aiming for completion within six weeks.
This acquisition aligns with Egypt’s strategy to privatize state-owned enterprises as part of its broader economic reform under the International Monetary Fund (IMF) program. The IMF has recommended a new economic model for Egypt that involves reducing the state’s role in the economy. Consequently, the goal of privatization is to boost economic productivity, attract foreign investment, and alleviate public financial burdens.
The discussions regarding the acquisition have drawn public interest and controversy. Notably, television host Amr Adib commented on social media platform X, indicating that the process of selling the bank discreetly seems implausible. He noted, “Selling the bank in secret is nearly impossible. We’ll soon find out who’s trying to buy it and what their offer is.” Furthermore, he alluded to the long-standing attempts to sell the bank dating back to the 1990s.
As of September 2023, Banque du Caire, which is owned by the state-run Banque Misr, holds assets valued at approximately USD 9.4 billion (EGP 478 billion). Banque Misr intends to sell a 45 percent stake in Banque du Caire for as much as USD 1.2 billion (EGP 60 billion) and may also consider listing additional shares on the Egyptian stock exchange.
Prime Minister Mostafa Madbouly announced last December plans to divest shares in at least ten government-owned companies by 2025, including four owned by military entities. These firms, which comprise military-operated retail chains such as Watanya and Chillout, may either be sold to strategic investors or become publicly traded entities on the Egyptian stock exchange.
The acquisition of Banque du Caire by Emirates NBD is part of Egypt’s broader efforts to privatize state assets as a means to enhance economic performance and attract foreign investment. With governmental support and a potential valuation exceeding USD 1 billion, this transaction could significantly influence the future financial landscape in Egypt. Public interest remains high as the details unfold regarding this strategic move.
Original Source: egyptianstreets.com
