Back to the complete issue
Tuesday, 27 July 2021

Contact makes first sukuk sale this year

Contact closes its second EGP 2.5 bn sukuk offering: Contact Financial Holding, formerly Sarwa Capital Holding, has closed its second sukuk issuance worth EGP 2.5 bn, the company said in a statement (pdf). The sharia-compliant mudaraba sukuk carries a seven-year tenor and will be used to finance the expansion of Contact Credit and its subsidiaries. The security received a credit rating of A- by Middle East Ratings and Investors Service.

This brings Contact’s total sukuk issuances to EGP 5 bn after closing a EGP 2.5 bn offering last November.

The issuance is the first sukuk sale to take place in Egypt this year and the fourth since the Financial Regulatory Authority adopted the regulatory framework in 2019. In addition to Contact’s two sales, Talaat Moustafa Group and private education outfit CIRA also took sukuk to market last year

More sukuk sales to follow (we just don’t know when): Contact is cooperating with others, mainly real estate developers, to manage sukuk issuances worth EGP 5-7.5 bn through its sukuk arm, the Sarwa Sukuk Company. The planned offerings include a EGP 5.5 bn sale for Palm Hills Development, a EGP 3 bn issuance for Hassan Allam Properties, and a EGP 1.1 bn offering for Amer Group. In June, Wadi Degla Developments also revealed plans for a sukuk issuance worth some EGP 2 bn through Contact. It remains unclear when the companies plan to market the securities.

Advisors:The issue was co-underwritten by CIB and Ahli United Bank. Sarwa Promotion and Underwriting, a subsidiary of Contact, was assigned as lead manager and arranger on the transaction. Misr Capital and Banque Misr acted as underwriters. Alieldean Weshahi & Partners acted as the legal advisor, while Elite Consulting Group was the independent financial consultant on the transaction.

IN OTHER CONTACT NEWS: Contact Financial Holding and real estate marketplace Sakneen have joined forces to offer a one-stop-shop for people searching for both a new home and mortgage finance, according to a statement (pdf). Prospective homebuyers can look for properties eligible for financing on and receive preliminary approval. Contact is offering 10-year loans of up to EGP 3 mn to Sakneen clients. Sakneen earlier this year raised USD 1.1 mn in seed funding with “major participation” from Sarwa Capital.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt; Hassan Allam Properties (tax ID:  553-096-567), one of Egypt’s most prominent and leading builders; and Saleh, Barsoum & Abdel Aziz (tax ID: 220-002-827), the leading audit, tax and accounting firm in Egypt.