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Thursday, 3 September 2020

Health, financial services among four new sub-funds announced by Sovereign Fund of Egypt

The Sovereign Fund of Egypt (SFE) has set up four sub-funds covering healthcare, financial services, tourism and real estate, and infrastructure, Al Shorouk reports, citing an announcement by Planning Minister Hala El Said published in the Official Gazette on Wednesday. The SFE originally planned to establish separate funds for renewables, logistics and manufacturing, but re-thought its investment strategy by the covid-19 pandemic.

The creation of a healthcare sub-fund was telegraphed by CEO Ayman Soliman in May, when he announced that the healthcare and pharma industries would be a top priority for the fund, alongside electricity, transport, agriculture and infrastructure. The fund has made several moves into the healthcare sector since the onset of the pandemic, announcing plans to set up a USD 300 mn healthcare JV with Concord International Investments in May, and reportedly considering buying a stake in state pharma company Chemical Industries Development.

The financial services sub-fund will focus on investments in the non-banking financial services sector and fintech. The SFE is seemingly looking to capitalize on the success of e-payments and fintech firms, which have been among the biggest beneficiaries of the pandemic as consumer demand for mobile payments and ecommerce surged. The sub-fund announced yesterday will invest in a range of non-banking financial services and investment companies covering everything from insurance, microlending and real estate finance, to credit ratings, portfolio management and securitization. The SFE has been in talks with investors interested in fintech and services that further financial inclusion at least since May, and announced its intentions to take a 76% stake in the Arab Investment Bank alongside EFG Hermes.

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