M&A WATCH- EFG Hermes announced it has entered “into definitive agreements to invest” USD 21.5 mn in Frontier Investment Management (FIM). The transaction, once completed, will leave EFG Hermes owning a 50% stake in FIM, with the remaining half still owned by FIM’s founder and CEO, Hedi Ben Mlouka. FIM will become part of EFG Hermes’ asset management business “while retaining its independence, brand name and autonomy in investing across regional and frontier capital markets.” EFG Hermes says, “FIM will continue executing its current strategy of delivering unique returns to its institutional investor base.” The investment bank will seek the consent of its clients to contribute its regional (non-Egypt related) portfolios and funds into FIM during the coming six months. Through the investment in FIM, EFG Hermes has positioned itself as the manager of choice for institutional investors seeking specialized active fund managers with a strong on the ground knowledge of MENA and frontier markets, said EFG Hermes Group CEO Karim Awad.

…Separately, EFG Hermes expects to serve as debt adviser to three Middle East companies on transactions worth a combined USD 700 mn by the end of 2018. The firm gave no further details about the three companies. EFG Hermes also plans to grow its financial leasing portfolio to EGP 5 bn from about EGP 2 bn currently, said Walid Hassouna, CEO of EFG Hermes Finance and head of the firm’s debt structuring division, told Reuters. The firm has also obtained preliminary approval from Egypt’s financial regulator to begin offering factoring services and could roll out of the offering as early as 4Q2017.