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Tuesday, 22 October 2019

Rameda, Misr Insurance and jeans maker T&C all make IPO news

IPO WATCH- There’s plenty of chatter in the market this morning about IPOs, some on the near horizon, others further out.

At the head of the class is Rameda Pharma, which Al Mal cites unnamed sources as saying is on track to offer shares on the EGX as early as this year and as late as 1Q2020. Rameda had mulled a listing on the London Stock Exchange, the newspaper says, but ultimately decided that the Egyptian Exchange was the right venue for the transaction. If the listing goes through before the year is out, Rameda would be the second company to go to the EGX in 2019, after Fawry made its trading debut in August. Rameda was one of at least three Egyptian companies believed to have pulled IPOs last year amid the fallout from the Emerging Markets Zombie Apocalypse.

State-owned Misr Insurance + Misr Life Insurance could be ready to IPO by 2021: Pre-IPO workstreams at state-owned Misr Insurance may take longer than previously thought, our friend Basel El Hiny suggested in an interview with CNBC Arabia (watch, runtime: 03:35). El Hiny, chairman of the Misr Insurance Holding Company, said Misr Insurance could be ready to go to market by 2021, implying a slip of a few months from the indicative 2020 timeline he had outlined this past July. Misr Life Insurance’s IPO preparations remain on track and could be completed next year, El Hiny said. Each company is expected to offer up to 30% of its equity, he said, confirming a value figure suggested by the government committee managing the privatization program. The IPOs were postponed last year to give them more time to reorganize ahead of the transactions.

Jeans maker T&C plans to IPO on the EGX, seeking finance for USD 40-50 mn plant: Tolba Group’s jeans manufacturer T&C is looking to sell an undisclosed number of shares on the EGX to finance its expansion plans, including building a new USD 40-50 mn factory, Chairman Magdy Tolba told the local press. T&C is currently in the market for a financial advisor for the potential listing, Tolba said, without providing further details on the expected timeline for the process. The company is looking to set up its new facility either in Obour City, where it has an existing factory, or in 10th of Ramadan City.

Reality check- No indicative timeline for an IPO is a “deadline” until an ITF drops — and even then… Market conditions change, and no company wants to go out in a perfect storm to offer shares at fire sale prices. That’s to say nothing of the natural tendency of CEOs to get cold feet before a transaction — or that IPOs can be called off at the last moment — and frequently are. Sometimes, IPO ‘announcements’ outside the formal legal documentation (claims that company “x” is “preparing for an IPO”) are just trial balloons or tactics. Shocking, we know, yet the domestic press often fails to keep this in perspective, and we sometimes allow this to seep into conversation in the wider community.

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