Egypt’s Naeem Holding for Investments Company will merge its Reacap Financial Investments with the country’s property developer Wadi Degla, creating a company with a book value of 3.5 billion Egyptian pounds ($197.18 million), Naeem Holding CEO Youssef Al Far said Tuesday.
Under the deal, Wadi Degla will have a 74 percent stake in the new entity, while Naeem Holding will have 26 percent, Far, speaking at a news conference in Cairo, said.
The merger deal, announced after the stock market closed on Tuesday, aims to combine Reacap’s mainly administrative activities with Wadi Degla’s real estate business and to expand its investment portfolio.
Far said the merger would be executed via a Reacap Financial Investments capital increase of about 300 million shares at a fair value of 11 pounds per share.
Reacap, which is listed on the Cairo bourse, has a total capital of 500 million pounds.
The merger is expected to be completed by the end of the year, with the new board to decide on whether to retain the name Reacap Financial Investments or not, Far told Reuters.
Wadi Degla Chairman Maged Helmy said the real estate portfolio of the new company would stand at six million square metres, with two million of that still undeveloped and 4 currently under development.