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Wednesday, 29 January 2020

Real estate firm Emerald to debut on stock exchange in “10 days”

IPO WATCH- Emerald set to become Egypt’s first IPO of 2020 in 10 days -Omran: Real estate investment firm Emerald will make its EGX debut “within 10 days,” making it this year’s first IPO, Financial Regulatory Authority Chairman Mohamed Omran said, according to the local press. EGX boss Mohamed Farid had said earlier this week that an IPO worth under EGP 1 bn will be going to market in 1Q2020. While Farid did not name the company, this is in line with previous press reports on Emerald’s planned offering, which will see the company sell 28% of its shares. Emerald plans to raise EGP 203 mn from the sale, unnamed sources said at the time.

Background: The IPO will see the company selling up to 70 mn shares, with 95% of these earmarked for institutional investors. The fair value assessment, which was conducted by the Professionals for Investment Banking, has set the share price at EGP 2.90 apiece. The IPO prospectus was reviewed by lead manager and major shareholder Odin Investments, along with the FRA.

Emerald will make its debut after the EGX closed 2019 with only two IPOs. Rameda Pharma went public in December after fintech player Fawry floated in August. Egyptian companies pulled back from raising capital after Sarwa Capital’s IPO went sideways in late 2018. A global slowdown in appetite for emerging market IPOs and fears the recent Aramco listing would suck liquidity out of the market also played a role last year. Meanwhile, Eastern Tobacco’s 4.5% secondary sale in March was the only state-owned company to go to market last year.

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