Intesa to start talks to buy rest of Egypt’s AlexBank
Italy’s biggest bank, Intesa Sanpaolo will start extensive negotiations in the coming few hours to buy the Egyptian government’s stake in subsidiary AlexBank, according to people familiar with the matter.
The Italian bank, which already holds a 80 percent stake in AlexBank, seeks to buy the remaining 20 percent owned by the Egyptian government, they further told Amwal Al Ghad on Monday.
Egypt State Share Plan
Earlier this month, Egypt revived a stalled programme to sell stakes in state-run banks and companies, including in two military-owned affiliated firms, as part of a plan to revamp an economy battered by the Russian war in Ukraine.
Under the plan, the government will offer for sale stakes in 32 firms in a variety of sectors, ranging between banking, oil, real estate, insurance, and ports.
The move is billed as a key part of Egypt’s broader drive to reform an economy that was hit by the Ukraine war, which sent food and energy prices soaring, and to secure much-needed foreign currency.
IMF Deal: More Private Sector Engagement
The government wants to expand private sector engagement, seeking to attract $40 billion in investment over the next four years. It also targets private investment surging to 65 percent of the country’s total within three years, up from around 30 percent at present. This is in line with a four-year $3 billion International Monetary Fund (IMF) financial support package reached in October 2022, whereby the government is committed to a greater role for the private sector besides range of monetary and fiscal reforms.
Established in 1957 as a state-owned commercial bank, it was known as Bank of Alexandria at the time until Sanpaolo IMI (Intesa Sanpaolo) acquired an 80 percent share in 2007 after a privatization process, and renamed it as AlexBank. In 2009, the International Finance Corporation (IFC) purchased a 9.75 percent share from Intesa Sanpaolo. Later in September 2020, Intesa Sanpaolo rebought the 9.75 percent stake, bringing the Italian bank’s stake in AlexBank back to 80 percent.