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Wednesday, 15 January 2020

FRA suspends Fincorp for three months over its fair value assessment of Americana for Adeptio's MTO

Regulator suspends Fincorp for three months over fair value assessment of Americana for Adeptio MTO: The Financial Regulatory Authority (FRA) has suspended Fincorp Investment Holding from carrying out valuation studies for a period of three months, according to a statement to the EGX (pdf). The suspension comes after the market regulator rejected as “unfair” Fincorp’s fair value assessment of the Egyptian International Tourism Projects Company (Americana) for a mandatory tender offer (MTO) Adeptio was required to submit for Americana.

Fincorp to file a grievance: Fincorp "respects the FRA decision" but will still challenge it via appeal, Chairman Mohamed Hamdy told Al Mal. He added that the company will also look into the possible legal paths to follow after its grievance is addressed.

Background: FRA ordered Adeptio to submit an MTO to buy shares in Americana Egypt in early 2019, after they gained indirect ownership of the majority of the company due to acquiring 67% in Kuwait Food Company (Americana) in June 2016. Adeptio claimed that did not require an MTO submission, but after a few denied appeals, they submitted an initial offer price of EGP 3.9 per share, based on Fincorp’s study. Americana’s minority shareholders signaled they would only be satisfied with an offer in the range of EGP 24 per share. The shareholders demanded that Adeptio revalue the company, but Adeptio stood by Fincorp’s share price, previously saying they hired a financial consultant “endorsed by the FRA.”

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