Despite Hermes Deal Failure Remarks, EGX 30 Crosses 5260 Pts; Midday
During Thursday’s midday session, the Egyptian Exchange (EGX) has posted remarkable gains of EGP 2.6 billion backed by local and Arab buyers despite remarks that the planned takeover of Egypt’s largest investment bank by Qatar’s QInvest LLC has been scrapped.
The capital market has amounted to EGP 358.186 billion, according to data compiled by Amwal Al Ghad English at 1:10 p.m. Cairo time (11:10 GMT) during Thursday’s midday session.
The EGX indices were wavering in green notes during the midday session.
Benchmark EGX30 climbed by 1.31% to 5264.36 p; while EGX20 rose by 0.58% to 6021.03 p.
Meanwhile, the mid- and small-cap index, the EGX70 advanced by 0.49% to 451 p. Price index EGX100 edged up by 0.91% to 752.48 p.
During Thursday’s midday session, the trading volume has reached 27.622 million securities worth EGP 161.485 million, exchanged through 5.703 thousand transactions.
This was after trading in 131 listed securities; 14 declined, 74 advanced; while 43 keeping their previous levels.
Egyptians and Arabs’ buying transactions have backed EGX’s midday gains as they were net buyers seizing 73.67% and 8.46% respectively, of the total markets, with a net equity of EGP 266.478 thousand and EGP 747.372 thousand, excluding the deals.
Meanwhile, the non-Arab foreigners were net sellers seizing 17.87% of the total markets, with a net equity of EGP 1.013 million excluding the deals.
Hermes’ Planning JV Agreement With QInvest Terminates; Shares Dive:
EFG-Hermes Holding (HRHO.CA) fell the most in more than five months on Egyptian regulatory turning down the planned takeover of Egypt’s largest investment bank by QInvest LLC.
Shares of the Cairo-based company fell 2.01%, the most since Nov. 25, to EGP 9.75.
Egypt’s financial regulator – the Egyptian Financial Supervisory Authority (EFSA) announced on Thursday that it has rejected the joint venture agreement between EFG-Hermes and Qatar’s QInvest LLC due to the limited expertise of QInvest that has not undertaken any activities since inception.
EFSA stated that the bidder – QInvest does not have sufficient expertise to own the units of EFG-Hermes Holding (HRHO.CA).
EFSA further confirmed that, out of its regulatory role of maintaining safety and stability of non-banking capital markets and protecting their dealers, and in light of the limited expertise of the bidding company that has not undertaken any activities since inception, it decided that the bidder does not have sufficient expertise to own the units of EFG-Hermes Holding; one of Egypt’s biggest investment banks.
On Wednesday afternoon, EFG Hermes and QInvest, Qatar’s leading investment bank, announced that the long-stop date for the satisfaction of the conditions precedent for their joint venture agreement to proceed had been reached without receiving the necessary regulatory approvals from Egypt’s financial regulator – the Egyptian Financial Supervisory Authority (EFSA). As a result of the long stop date being reached, the joint venture agreement will automatically terminate.
The parties received the necessary financial services regulatory approvals in all other markets in which the joint venture was initially to operate including Qatar, the United Arab Emirates, Saudi Arabia, and Jordan, among others. EFG Hermes and QInvest co-operated fully with all regulators, met all of their requirements and exercised the utmost diligence in addressing any regulatory requests in a timely and comprehensive manner.
