EFG-Hermes Says No Word From Egypt Regulator On Qinvest Deal

EFG-Hermes (HRHO.CA), the Middle East’s largest investment bank, said on Tuesday it has not received notification from Egypt’s financial regulator of clearance for its merger with QInvest of Qatar.

Shares in EFG jumped 6 percent on a newspaper report that Egyptian Prime Minister Hisham Kandil had told Qatari businessmen that the deal would go through by the end of this week during a visit to Doha last Wednesday.

An EFG spokesman told Reuters: “EFG Hermes Holding has not been informed of any development and accordingly we have published a disclosure to the EGX (Cairo stock exchange) this morning confirming that we didn’t receive a “no objection” response on the deal till date.”

A spokesman for the Egyptian Financial Supervisory Authority said he had no immediate comment.

EFG has said the joint venture, signed last May, will fall through unless it receives regulatory approval by May 3.

The deal is politically sensitive in Egypt because both of EFG’s chief executives, Hassan Heikal and Yasser El Mallawany, are on trial, along with the two sons of ousted President Hosni Mubarak, on allegations of illegal share dealings in relation to a 2007 transaction.

Egypt received a pledge of another $3 billion in financial support from Qatar during Kandil’s visit. The emirate’s prime minister said there were no strings attached to the aid, which will be in the form of Qatari purchases of Egyptian government bonds.

Reuters