Cairo – Mubasher: EFG-Hermes stated Sunday its business roadmap after partially exiting from Credit Libanais Bank, shedding light on main seven pivots, a press release indicated.
Earlier, EFG-Hermes Holding completed selling off a 40% stake in Credit Libanais Bank after getting all regulatory approvals. It also entered into an irrevocable underwriting agreement to sell the remaining indirectly-owned 23.7% stake, or 5.506 million shares, in the bank at $181.7 million. The deal is expected to be finalized by the end of May 2017.
Starting with excess cash, the firm is going to put forward returning EGP 1.08 billion (or 40% of the proceeds) to shareholders through either cash dividend distribution or buybacks. Shareholders are expected to discuss this proposal in a general meeting.
Second, the company seeks to settle all expenses related to the transaction, including, (i) placement fees related to the sale and paid to the placement agent (CLIB); (ii) a one-off fee paid to the employees of CL as an exit / change of control bonus (iii) other related potential expenses.
On the level of its subsidiaries, the company reaffirmed commitment to the progress of its investment Bank operations in the MENA regions through enhancing capital structure, meeting capital adequacy requirements, and embracing new opportunities. Moreover, it intends to capitalize newly established business, namely EFG Hermes Leasing.
Fourth, the company also plans to expand its assets under management whether on the public or private market to an extent that generates a steady annual flow of management fees together with the upside potential of periodic performance fees.
On the road to supporting strong presence in MENA, the firm endeavors to be a “frontier house” during two years, which will necessarily require expansions into new markets. Accordingly, the investment bank started due diligence for acquiring a Pakistani entity, putting eye on other destinations such as Morocco, Vietnam, Bangladesh, Sri Lanka, and Kenya, expecting business to take place in some of these countries between Q4-16 and Q1-17.
Moreover, the firm diligently working on growing the finance platform as well as adopting merchant banking model that will enable the firm to pursue underwriting activities for both debt and equity as well as selectively taking pre-IPO positions in a companies that are in need of capital to finance their final phase of growth before going public.
