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Thursday, 25 July 2019

Justice Ministry committee adjourns Raya case against FRA to 22 Sep

DISPUTE WATCH- Raya’s case against the FRA adjourned to 22 September: The Justice Ministry’s dispute resolution committee has adjourned a case filed by Raya Holding’s Chairman Medhat Khalil against the Financial Regulatory Authority (FRA) to 22 September, sources close to the matter told Al Mal. A fresh dispute has arisen between the two sides after the FRA insisted that its own committee should mediate the dispute, instead of the dispute resolution committee, the sources said. Khalil, who is looking to reduce or overturn the EGP 11 mn fine imposed by the FRA in connection with a mandatory tender offer, had requested that the dispute resolution committee act as the mediator.

Background: The FRA filed the lawsuit against Khalil in May alleging that he failed to pay an EGP 11 mn fine handed out after he exceeded the maximum ownership limit in Raya without making a mandatory tender offer (MTO). The FRA had ordered Khalil at the end of last year to submit an MTO for Raya or sell down his stake, arguing that he and related parties controlled a combined 42% of the company — a level of control that triggers the requirement for an MTO under securities regulations. Khalil bought 26.7% (56.919 mn shares) of Raya Holding through his El Pharonia Real Estate Investment at a cost of EGP 314.76 mn in an MTO. An administrative court will separately look into charges brought by the FRA against Raya Holding founder Medhat Khalil on 29 July.

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