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Wednesday, 7 August 2019

America Egypt minority shareholders call for EGP 24 share price in disputed MTO

DISPUTE WATCH- Americana Egypt minority shareholders call for EGP 24 share price in disputed MTO: Minority shareholders of Americana Egypt are asking for a share price determined in a 2016 valuation of the company in a planned mandatory tender offer (MTO) by majority shareholder Adeptio AD Investments, sources close to the matter told Al Mal. The 2016 acquisition valued the company’s share price at EGP 24, a figure seen by the minority shareholders as close to the share’s real value.

Why the old valuation? Minority shareholder Hatem Sultan told the local press last week that, after the 2016 acquisition agreement, Adeptio made a few undisclosed internal and structural decisions that may have impacted the company’s value. He made it clear that they will continue their fight with the company until it makes a “suitable offer.” The minority shareholders wrote to the FRA relaying their views after it emerged that Adeptio is planning to conduct a new fair value estimation of the share price. Adeptio said it “would take into account” the recent acquisition in the new valuation, which is expected to be revealed in early 4Q2019.

Background: Adeptio, which is led by Emirati businessman Mohamed Alabbar, acquired in 2016, 67% of Americana Egypt’s parent company, Kuwait Food Company (Americana), over a two-year process. This resulted in Adeptio controlling some 90% of the subsidiary’s shares, and prompted an FRA-ordered MTO to purchase the remaining shares. Adeptio submitted an appeal against the order, which the FRA promptly rejected. It then challenged the appeal’s rejection at an economic court, but had its claims dismissed.

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