Qalaa’s Agrifoods Business unit divests two subsidiaries

Egypt’s Qalaa Holdings, an African leader in energy and infrastructure, announced Thursday that its business unit Gozour signed a sale and purchase agreement (SPA) to divest its entire holding in milk and juice producer, Enjoy and El-Aguizy.

The purchaser of both companies is Kamal Haggag, a domestic industrial investor who also bought Gozour subsidiary El-Misrieen in December 2015.

Qalaa had previously impaired the value of its investments in Enjoy and El-Aguizy, which are distressed assets, and have not been operational since 2013 and 2015 respectively and thus their sale will have a positive impact on the P&L of Qalaa as it will be able to deconsolidate their losses. Both companies will be sold free of bank debt, while the purchaser will assume all other liabilities.

Qalaa Holdings currently has an effective indirect ownership of 55 percent in both Enjoy and El-Aguizy

The sale of El-Aguizy is expected to close quickly with Enjoy to follow once a set of conditions precedent are fulfilled.

Qalaa Holdings continues to divest non-core investments across its footprint as it focuses on core business units including Egyptian Refining Company (a US$ 3.7 billion megaproject that is now more than 84% complete and on track to begin production in 2017 and TAQA Arabia, Egypt’s leading independent energy distribution company.

Qalaa recently divested its stake in Tanmeyah Microenterprise Services, a business that it helped grow from an initial concept into an 450 million Egyptian pounds operation that provides the Egyptian market with much–needed microfinance solutions, as well as its stake in Misr Glass Manufacturing Company (MGM), a leading regional producer and exporter of glass containers for an equity value of c. 828 million pounds.

Pharos Holding is the sell-side advisor on the Enjoy and El-Aguizy transactions.