Monday, 22 November 2021

PM — Aldar and ADQ get regulatory greenlight to acquire 90% of SODIC.

TL;DR

🔎 WHAT WE’RE TRACKING TONIGHT

Good afternoon, friends. Mondays are typically the slowest news days of the week, but today probably takes the cake — save for one massive story:

THE BIG STORY TODAY- Aldar-ADQ acquisition of SODIC gets FRA nod: The UAE’s Aldar Properties and sovereign wealth fund ADQ’s bid to acquire 90% of upmarket real estate developer SODIC just earned the regulatory greenlight, two months after the Emirati parties submitted their mandatory tender offer, according to a statement from the Financial Regulatory Authority (pdf).

We’ll have chapter and verse on the story in tomorrow’s edition of EnterpriseAM.

** CATCH UP QUICK on the top stories from today’s EnterpriseAM:

  • SPAC regs are here: The Financial Regulatory Authority issued the rules and regulations for investors looking to establish local blank-check firms, outlining capital requirements, shareholder structure and regulatory responsibilities SPAC founders will need to comply with.
  • Edita wants Ole bakeries producer: Edita Food Industries has submitted a non-binding letter of intent to acquire the Egyptian Belgian Company’s assets, announcing it will begin due diligence which it expects to wrap up on or before 15 December.
  • Better quality calls on the horizon? Vodafone Egypt, We and Etisalat have received the new cellular spectrum they were awarded in an auction last year from the National Telecommunications Regulatory Authority (NTRA), which would help the network operators majorly improve audio and transmission services.

THE BIG STORY ABROAD-

MARKET WATCH- Are we on the brink of a market correction? Equity markets could enter correction territory if the US Federal Reserve decides to enact an “abrupt” policy change and adopt a tougher stance on addressing inflation, Professor of Finance at the Wharton School of the University of Pennsylvania Jeremy Siegel said to CNBC. The speculation of a potential shift in policy — coupled with a potential changing of the guard as US President Joe Biden has yet to nominate a new head of the central bank once Jay Powell’s term ends — has sent waves of uncertainty across international stock markets. Siegel criticized the Fed for being “behind the curve” with its monetary policy and maintaining its quantitative easing policies, forecasting that cumulative inflation could reach 20% to 25% over the next several years.

The moment of truth: The next Federal Open Market Committee meeting is scheduled for 14-15 December, the outcome of which could trigger the correction Siegel is forecasting.

The FOMC meeting will wrap one day before the Central Bank of Egypt’s Monetary Policy Committee will sit down to decide on interest rates here at home. Rising global inflation has so far not pushed the CBE to enact any interest rate changes, with an eye to protect the all-important carry trade.

Iran-backed Houthi fighters are using bomb-laden boats in the southern Red Sea, creating “imminent danger” to global shipping and trade, the Saudi-led coalition on Yemen said, according to Al Arabiya. The coalition said it is “neutralizing” the threat and is taking “operational measures” against the maritime threat to ensure freedom of navigation, without providing further details. The incident comes after the Houthis said they used drones to attack airports and Aramco refineries in Saudi.

FOR TOMORROW-

The new administrative capital plays host to a Comesa summit starting tomorrow, the same day the state’s SECC hosts a webinar on fintech in Egypt.

ITIDA and the Software Engineering Competence Center are hosting a webinar on the future of fintech in Egypt tomorrow. The event will look at the current landscape and expected changes in light of new tech, regulations and market changes. You can register to attend here.

BOOK LAUNCH- Up and Doing, a memoir penned by Egyptian-American Enterprise Fund Chairman James Harmon (Morning Routine), will be published tomorrow. The memoir recounts Harmon’s career as a banker and discusses “how markets can move the world forward by creating stable, growing economies and sound [transactions] that promote economic development.”

🗓 CIRCLE YOUR CALENDAR-

The Home Appliances and Table Show (HATS Egypt) kicked off today and wraps up on Wednesday. The event is organized by the Engineering Export Council of Egypt and brings together companies working in the home appliances sector.

Startup gathering RiseUp starts on Thursday and runs through Saturday.

The Cairo International Film Festival kicks off its weeklong run this coming Friday.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

☀️ TOMORROW’S WEATHER- Expect a daytime high of 24°C tomorrow and a nighttime low of 14°C, our favorite weather app tells us. The cool weather will continue until Saturday before the mercury rises to 30°C once again.

🚙 FOR YOUR COMMUTE

Can Big Tech help us achieve a healthier work-life balance? The rise of new software and tools to help remote workers disconnect from their day jobs could instigate a major cultural shift in how we manage our time after hours, writes tech columnist Parmy Olson in Bloomberg Opinion. Tools allowing people to block work notifications past a certain time and control who can message them can help battle the “overwork culture” made worse by the pandemic-induced remote work boom. Microsoft earlier this year said it was expanding its Quiet Time feature across Teams and Outlook, while Apple has launched a Personal Mode feature to allow users to control which people and apps can message them during personal time.

But isn’t Big Tech the reason we’re here in the first place? The irony of the tech companies whose chat and co-working tools facilitated the demise of personal time now coming up with a solution to resurrect it is not lost on us, but it is a development that is welcomed by many. The more these tools become available, the more they signal to people that a healthy work-life balance is a right they should (and now, can) entertain. And making these tools available will probably be more effective than trying to safeguard personal time through regulation, as in the case of Portugal, which recently passed a law banning managers from messaging their employees after working hours, though its method of implementation remains unclear.

How green will Saudi’s planned green bonds actually be? With the world’s top oil exporter Saudi Arabia planning to enter the green bond market, investors are split on whether to take its claims over its environmental targets seriously, Bloomberg reports. The oil exporter has rejected an International Energy Agency analysis calling for an end to new fossil fuels exploration, and has said it would aim for net zero emissions by 2060, without specifying how it will get there. The Saudi government and sovereign wealth fund are preparing to sell green bonds in the coming months, in transactions that may raise bns of USD and will help finance projects such as a sustainable tourism resort on the Red Sea powered entirely by renewable energy, according to the report.

Reality check: The bonds will likely find plenty of buyers. Given the insatiable investor appetite for all things green as of late, and given the kingdom's efforts to recast itself in an environmentally-concerned world, many investors will likely shrug off the optics of buying green bonds from the world’s top oil exporter. As part of its environmentally friendly makeover, Saudi Arabia recently announced plans to build a floating city on the Red Sea powered entirely by renewables.

No college degree? No worries, you can still fulfill your childhood dream of going into space: The Japan Aerospace Exploration Agency (JAXA) is waiving requirements for would-be space travelers, allowing anyone with a minimum of three years of work experience in any field to enter the country’s space program, reports Bloomberg. The agency has also relaxed height requirements and announced plans to launch a campaign to encourage more women to embark on careers in space. Japan does not have any female astronauts, and female astronauts are in short supply at NASA and the European Space Agency as well.

👌 ENTERPRISE RECOMMENDS

GoT fans should check out The Wheel of Time + Using data to derive insights from the world’s biggest startups

📺 ON THE TUBE TONIGHT-

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Epic fantasy series The Wheel of Time comes to Amazon Prime: Based on the 14-novel series by Robert Jordan, the fantasy show is an earnest saga of friends embarking on a clear-cut quest to save the world. The Wheel of Time follows an all-magical, all-women organization called the Aes Sedai led by Moiraine (played by Rosamund Pike). The Aes Sedai attempt to fight the forces of darkness, but their main goal is to find the Dragon Reborn — a person who has enough magic to either save or destroy the world… depending on who finds them first. The show is being recommended to fans of Game of Thrones and the first season is out now on Amazon Prime.

It’s a quiet day in European football in preparation for the decisive rounds of the Champions League tomorrow and the day after.

Here at home: Ghazl El Mahalla will play against Al Ahly on the former’s home turf today in a match as part of the fifth round of the local Premier League at 5:30pm. Ghazl El Mahalla occupies fourth place with two victories and two draws without any defeats so far, while Al Ahly is leading with a victorious streak. At 8pm, Zamalek (currently ranking third) will play on their home turf against National Bank, while El Gouna will hit the field against Al Masry at the same time.

🎤 OUT AND ABOUT-

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Ubuntu Art Gallery has launched two new exhibitions: Licorice shows off the latest work by contemporary painter Dina AbdelNabi whose work has shown in the Museum of Egyptian Modern Art and in exhibitions worldwide. Meanwhile, Abi Park by Omar Gabr shows paintings that are inspired by his experience recovering from cancer at a young age.

Journalism professor Mervat Abou Oaf is moderating a panel discussion on media’s effect on society. The talk, titled “Do we use media or get abused by it?” takes place this Wednesday at 6pm at the AUC Campus in New Cairo.

💡 UNDER THE LAMPLIGHT-

A data-driven approach to understand what differentiates the world’s biggest startups: Super Founders by Ali Tamaseb utilizes what may be the largest dataset ever collected on startups — put together by the author — to look at the success factors of USD bn startups including Zoom, Facebook, Paypal, Airbnb, YouTube, and LinkedIn. Tamaseb looks at several factors, including number of competitors, market size, founders’ age, their universities’ rankings, quality of investors, and fundraising timeline — and comes to unexpected conclusions based on his analysis. Some of the most surprising finds include the fact that most unicorn founders had no industry experience and already had strong competitors in the market when they launched. Through these insights and more, Tamaseb creates a data-driven guide for entrepreneurs looking to create a successful business.

🌊 GO WITH THE FLOW

Mopco sees 171% y-o-y increase in bottom line in 3Q2021

EARNINGS WATCH-

Misr Fertilizers Production Company (Mopco) reported a 171% y-o-y increase in its bottom line in 3Q2021 to EGP 1.34 bn, according to the company’s quarterly financials (pdf). The state-owned company reported EGP 2.90 bn in net revenues for the quarter, up 69% y-o-y.

MARKET ROUNDUP-

The EGX30 rose 0.8% at today’s close on turnover of EGP 764 mn (47.4% below the 90-day average). Regional investors were net buyers. The index is up 4.7% YTD.

In the green: Rameda (+6.8%), EFG Hermes (+5.9%) and Pioneers Properties (+3.5%).

In the red: Fawry (-1.7%), Egypt Kuwait Holding-EGP (-0.8%) and Oriental Weavers (-0.6%).

👫 GENDER EQUALITY

How to pave the way to a new social contract in the global post-covid economic recovery: Covid-19 has had a disproportionate effect on women, who are bearing the brunt of the economic, healthcare, and environmental crises that spiraled in the aftermath of the pandemic, according to UN Women. These crises and how they intersect are “deeply rooted” in a global system that “freerides on women’s unpaid and underpaid labour, exploits the natural environment and has led to an extreme concentration of wealth and power among the few while causing a deep sense of insecurity among the many,” the organization says in its Feminist Plan for Sustainability and Social Justice report (pdf).

What are the issues women are facing? The report indicates that women lost their jobs at an alarming rate, with one in five women across 45 countries saying they fell out of employment during the pandemic. This phenomenon was exacerbated by the childcare crisis: As schools and daycare centers shut down, many women were forced to leave the workforce to tend to their children at home. This trend did not hold up among partnered men with children, as a larger proportion of women with children took on childcare responsibilities. Women also bore the brunt of providing care for ill family and community members, the report says. The pandemic and shift to WFH also pushed up domestic abuse rates, and expects a jump in child marriage and FGM rates as more girls stayed home from school.

These aftershocks have been even more pronounced across the developing world, where many women earn their income from the informal economy. Nationwide lockdowns in early 2020 as the virus that causes covid-19 first began to spread “prevented almost three-quarters of informal workers from doing their jobs in April 2020,” according to the report. While income fell “dramatically” across the board, women’s average earnings dropped to 19% of their pre-covid levels, while men saw their earnings fall to around 25% of what they were before the pandemic. And once lockdowns began to ease, women’s earnings recovery lagged that of men — as of mid-2020, men’s average earnings rebounded to 65% of pre-covid levels, compared to 50% for women.

Egypt is no exception — although the specifics diverge a little from the global trend: The jobless rate here at home skyrocketed to a near two-year high in 2Q2020, with Capmas data indicating that a large number of working women left the workforce to stay home and look after kids or other family members. Women in Egypt shed jobs at a faster rate than men, but this trend was predominant in the informal sector and among women working in private sector jobs, Deputy Country Representative at UN Women Egypt Gielan El Messiri told Enterprise. Many of those who exited the workforce were forced to do so as they took on the burden of childcare. Women working in the public sector typically have greater levels of job protection than those who have private sector jobs, according to El Messiri.

Also not helping matters: Concerns about the short-term side effects of vaccination. Across Africa, many women who are primary or sole breadwinners are refusing to take the vaccine over fears that the side effects of inoculation — including fatigue and fever — could force them to miss out on even a single day of work. This concern, coupled with misinformation about the jabs reducing chances of childbearing, is widening the gender gap in vaccination levels across the continent, and ultimately slowing down efforts to put an end to the pandemic.

So, how can we go about fixing these issues? Progressive taxation to address gender imbalances in tax policies, improving workplace safety and expanded social protections for women are among the many policy prescriptions outlined in the report that could help create a more just and equitable economy in the aftermath of the pandemic. The report also stresses the need for a “big public investment push” to lay the foundation for structural transformation, including investments in the care economy, and creating jobs for women in the green economy. These policies would help trigger “a much faster decline in unemployment than a strategy that stifles recovery through premature austerity and budget cuts.”

How Egypt is faring on these policy prescriptions: At the outset of the pandemic, the government deepened its investments in the Takaful and Karama welfare programs, which was first introduced in 2015 and primarily support poor women and children. UN Women Egypt has been working on advancing progressive taxation in Egypt and has also been working with state authorities to “deepen the work that is happening around gender-responsive budgeting” and to account more for the implications of expenditure on women and men, according to El Messiri.

📆 CALENDAR

November: The French-Egyptian Business Forum is set to take place in the Suez Canal Economic Zone.

November: Egypt will host another round of talks to reach a potential Egyptian-Eurasian trade agreement, which can significantly contribute to increasing the volume of Egyptian exports to the Russia-led bloc that includes Armenia, Belarus, Kazakhstan and Kyrgyzstan.

22-24 November (Monday-Wednesday): The Home Appliances and Table Show (HATS Egypt) is taking place, organized by the Engineering Export Council of Egypt.

23 November: 2021 Common Market for Eastern and Southern Africa (Comesa) summit in Sharm El Sheikh.

23 November (Tuesday): Webinar on FinTech Future in Egypt.

25 November (Thursday): Rameda Pharma’s annual general meeting (pdf), at which it will decide on the sale of a 5% stake in the company from an individual shareholder to an unnamed institutional investor.

25 November (Thursday): Ibnsina Pharma’s extraordinary general assembly meeting (pdf) to discuss the company’s planned capital increase to EGP 280 mn through a share issuance.

25-27 November (Thursday-Saturday): RiseUp Summit, Cairo, Egypt.

26 November-5 December (Friday-Sunday): The 43rd Cairo International Film Festival.

28 November-1 December (Sunday-Wednesday): Creative Industry Summit, Nile Ritz-Carlton.

29 November-2 December (Monday-Thursday): Egypt Defense Expo, Egypt International Exhibition Centre.

30 November (Tuesday): Launch of open call by KfW for green project proposals in Egypt as part of their Investing for Employment facility (pdf).

End of November: El Nasr Automotive expects to have found a replacement for Dongfeng as its partner for its local EV assembly plans.

1 December (Wednesday): Unvaccinated members of the public will be banned from government buildings from this date; unvaccinated students will be prevented from accessing university campuses.

1 December (Wednesday): Government departments will begin moving to offices in the new capital.

5 December (Sunday): Purchasing managers’ index figures for November for Egypt, Saudi Arabia, and Qatar will be released.

7-8 December (Tuesday-Wednesday): North Africa Trade Finance Summit.

8-10 December (Wednesday-Thursday): Global Forum for Higher Education and Scientific Research (GFHS), Cairo, Egypt.

10 December (Friday): Capmas will release November inflation figures.

12 December (Sunday): Raya Holding’s Ordinary General Assembly meeting.

12-14 December (Sunday-Tuesday): Food Africa Cairo trade exhibition, Egypt International Exhibition Center, Cairo, Egypt.

13-17 December: United Nations Convention against Corruption, Sharm El Sheikh, Egypt.

14 December (Tuesday): Inquiry session for the Industrial Development Authority’s licenses to manufacture steel products.

14-19 December (Tuesday-Sunday): The Cairo International Festival for Experimental Theater.

14-15 December (Tuesday-Wednesday): The Federal Reserve meets to review interest rates.

15 December (Wednesday): Deadline for joint stock companies and investment companies in Cairo to join e-invoicing platform.

15 December (Wednesday): Target date for snackmaker Edita to wrap up due diligence on its acquisition of the Ole brand owner Egyptian Belgian Company.

15 December (Wednesday): The European Bank for Reconstruction and Development will give its final approval for a USD 100 mn facility to state-owned Banque Misr to finance local SMEs working on green projects.

16 December (Thursday): The CBE’s Monetary Policy Committee will meet to review interest rates.

End of 4Q2021: EdVentures plans to have closed at least one more edtech investment round.

End of 4Q2021: Fawry plans to have launched its MyFawry card.

1H2022: The World Economic Forum annual meeting, location TBD.

1H2022:: e-Aswaaq’s tourism platform will roll out its ticketing and online booking portal across Egypt.

1H2022: e-Finance’s digital healthcare service platform, eHealth, will launch its services.

1Q2022: Launch of the Egyptian Commodities Exchange.

1Q2022: Swvl acquisition of Viapool expected to close.

1 January 2022: Capital gains tax comes into effect on the EGX for local investors.

7 January 2022 (Friday): Coptic Christmas.

10-13 January 2022 (Monday-Thursday): World Youth Forum, Sharm El Sheikh.

15 January (Saturday): Target date for the finalization of snackfood giant Edita’s acquisition of the Egyptian Belgian Company, owner of the Ole brand.

17-19 January 2022 (Monday-Wednesday): World Future Energy Summit, Abu Dhabi.

27 January 2022 (Tuesday): National holiday in observance of 25 January revolution anniversary / Police Day.

11 February 2022 (Friday): Deadline for Anghami SPAC merger.

11-13 February (Friday-Sunday) FIBA Intercontinental Cup, Cairo.

14-16 February 2022 (Monday-Wednesday): Egypt Petroleum Show, Egypt International Exhibition Center, New Cairo, Egypt.

15 February 2022 (Tuesday): The Industrial Development Authority’s deadline for receiving offers from companies for licenses to manufacture steel products.

19 February 2022 (Saturday): Public universities begin the second term of the 2021-2022 academic year.

March 2022: 4Q2021 earnings season.

March 2022: World Cup playoffs.

2 April 2022 (Saturday): First day of Ramadan (TBC).

22-24 April 2022 (Friday-Sunday): World Bank-IMF spring meeting, Washington D.C.

24 April 2022 (Sunday): Coptic Easter Sunday (holiday for Coptic Christians).

25 April 2022 (Monday): Sham El Nessim.

25 April 2022 (Monday): Sinai Liberation Day.

Late April – 15 May 2022: 1Q2022 earnings season

May 2022: Investment in Logistics Conference, Cairo, Egypt.

2 May 2022 (Monday): Eid El Fitr (TBC).

16 June 2022 (Thursday): End of 2021-2022 academic year for public schools.

27 June-3 July 2022 (Monday-Sunday): World University Squash Championships, New Giza.

30 June 2022 (Thursday): June 30 Revolution Day, national holiday.

2H2022: IEF-IGU Ministerial Gas Forum, Egypt. Date + location TBA.

8 July 2022 (Friday): Arafat Day.

9-13 July 2022 (Saturday-Wednesday): Eid Al Adha, national holiday.

30 July 2022 (Saturday): Islamic New Year.

Late July – 14 August 2022: 2Q2022 earnings season.

6 October 2022 (Thursday): Armed Forces Day, national holiday.

8 October 2022 (Saturday): Prophet Muhammad’s birthday.

18-20 October 2022 (Tuesday-Thursday): Mediterranean Offshore Conference, Alexandria, Egypt.

Late October – 14 November 2022: 3Q2022 earnings season.

**Note to readers: Some national holidays may appear twice above. Since 2020, Egypt has observed most mid-week holidays on Thursdays regardless of the day on which they fall and may also move those days to Sundays. We distinguish below between the actual holiday and its observance.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2021 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of Commercial International Bank (tax ID: 204-891-949), the largest private-sector bank in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; and Act Financial (tax ID: 493-924-612), the leading activist investor in Egypt; and Abu Auf (tax ID: 584-628-846), the leading health foodmaker in Egypt and the region.