Egypt has healthy M&A and IPO pipelines that could materialize once markets stabilize post-covid, Renaissance Capital said yesterday. The main source of planned IPOs is the state privatization program, which includes two dozen candidates that are slated either for IPOs or stake sales by already-listed companies. Banque du Caire and e-Finance’s planned EGX debuts are “two of the most anticipated” IPOs currently in the pipeline, RenCap notes. Private sector companies, including Ebtikar, Raya’s NBFS arm Aman, and Galina Holding, are also looking at listing on the bourse in early 2021.

Why we’re seeing an M&A wave in the banking sector: The Central Bank of Egypt hasn’t been issuing new banking licenses for years, which means the only way into the sector is by acquiring existing licensed banks, RenCap notes. Recently, there have been more windows for acquisitions as international banks, particularly Lebanese lenders such as Bank Audi and Blom Bank, have been looking to exit the country because of issues in their home countries. These windows have proven particularly attractive to GCC banks, which are looking to “enter or scale up in Egypt.” For example, Bahrain’s Bank ABC is currently in early talks to acquire Blom. RenCap also points to government entities, such as the National Investment Bank, selling off their stakes in banks and “a long tail off sub-scale private banks” as other primary factors for the uptick in the sector’s M&A activity.