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Monday, 31 August 2020

IMEX International acquisition over Nile Cotton Ginning stumbles

M&A WATCH- Is IMEX International’s acquisition of Nile Cotton Ginning stumbling? Energy trading company IMEX International’s offer to acquire 50% of Nile Cotton Ginning has been plunged into uncertainty after majority shareholder Samir Afifiy and associates who collectively own 13% of the company refused IMEX’s offer price, unnamed sources told Al Mal. IMEX told the Financial Regulatory Authority last week that it would submit a mandatory tender offer for the company at EGP 50/share, a move which Afifiy described as “hostile,” and pledged not to accept any offer below EGP 70. Meanwhile, the workers’ union, which holds 7.06% of the company believes that the bid is suitable, given that the latest offer they received priced the shares at EGP 49 apiece, the sources said.

Advisors: The company has appointed EgyTrend as its financial advisor on the transaction.

Background: The company has been mired in a decade-long dispute that arose after a court ruling in 2011 to reverse the company’s Mubarak-era sale to private investors. The ruling nullified the privatization claiming that the company had been undervalued. An appeal was turned down in 2013 by the Administrative Court. The government’s investment dispute resolution committee reached a settlement agreement with the company that will see Nile Cotton pay EGP 231.1 mn to the Holding Company for Construction and Development. The agreement came as Nile Cotton’s shareholders were looking to reach a settlement in the hope of resuming trading the company’s shares on the EGX after an eight-year hiatus.


Corrected on 31 August 2020

Updated the homepage link for EgyTrend.

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