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Egyptian Billionaire Naguib Sawiris Will Finalize Acquisition of CI Capital Holding by the End of March

Mar 07, 2016 09:04 AM EST

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Naguib Sawiris will finalize buyout of CI Capital Holding by the end of March. The acquisition will make the second largest investment bank in Egypt.

Naguib Sawiris is a son of Onsi Sawiris who founded the Egyptian conglomerate, Orascom. Naguib Sawiris was appointed to lead the Orascom Telecom Holding which was founded in the late 1990's as a spun-off from Orascom holding company.

Orascom Telecom began its business venture with Mobinil as the first mobile operator in Egyptian in 1998. Orange SA, French telecommunication acquired 94% of Mobinil in 2012, by purchasing Sawiris share in his investing arm, Orascom Telecom Media and Technology (OTMT). Later in February 2015, Orange SA purchased 5% of OTMT remaining share in Mobinil, raising its share in Mobinil to 98% and renamed the company into Orange Egypt.

On February 25, Orascom Telecom Media and Technology nominated Beltone Financial Holding to purchase 100% of CI Capital, as Daily News Egypt reported OTMT planned to combine its newly acquired financial company Beltone Financial with CI Capital to create a regional financial conglomerate.

In a follow up move, last Sunday Sawiris said to complete the acquisition by the end of this month, as quoted by Bloomberg. The 924 million Egyptian-pound ($118 million) deal is soon to be executed after the share-purchased agreement was signed, and there is no regulatory objection.

Four months ago, OTMT acquire another bank, Belton Financial Holding SAE for 600 million pounds ($76 million). Sawiris plan to combine both banks, forming the second-largest investment bank in Egypt, controlling 25% of Egypt's brokerage business. Sawiris made the acqusition in the midst of Egyptian financial crisis.

"There's a major crisis in the economy," Sawiris said regarding his action. "If you believe that when things get really bad, that's when they start to get better, it's the right time to" invest, he said. "The end game is definitely to create the largest player in Egypt."

Referring to the nations's largest investment bank, EFG-Hermes, Sawiris said that his acquisition of CI Capital is, "purely a market opportunity because the investment, brokerage and asset management scene in Egypt was divided into one big player and lots of small and medium-sized fraction players."

Reuters reported that Beltone share climbed 9.9 %, after more than doubling in price over the past two weeks, while CI Bank, was up 2.6%. Meanwhile OTMT shares soared 5.3% on more than twice the stock's average volume in the last three months.

OTMT has become the most heavily traded stockin the market. The gain has marked down the company's loss to 15%, giving the OTMT a 3.1 billion pounds ($395 million) value.

Billionaire Naguib Sawiris and his investment arm Orascom Telecom Media and Technology will finalize acquisition of CI Capital Holding by the end of March. CI Capital will be combined with Beltone Financial Holding, to become the second-largest investment bank in Egypt with 25% control of brokerage business.

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