Tuesday, 28 September 2021

TONIGHT: Abu Auf parent company eyes 2Q2022 EGX listing. + Egypt #36 out 53 countries to hunker down in during covid. ALSO: UK perils get worse.

We hope you’re all ready to slide into the back half of the week now that hump day is behind us. It’s a quiet afternoon for news here at home and abroad, but the winds blowing in global markets are a little bit … stiff? Unpredictable? We’re not joining the bears in salivating over the prospect of a correction, but you could be forgiven for thinking that others are.


#1- Healthy food provider Abu Auf’s parent company, AUF, will be making its EGX debut in 2Q2022 with EFG Hermes quarterbacking the transaction, the company said in a statement (pdf). AUF could offer up to 49% of its capital, with the proceeds funding the company’s regional expansion plans. In the market now: State-owned fintech platform and digital payments infrastructure provider e-Finance is pulling the trigger on its sale this fall. EGX chairman Mohamed Farid has telegraphed that the pipeline is deep.

^^ We’ll more on AUF’s IPO in tomorrow’s edition of EnterpriseAM.

#2- Egypt inched up slightly in Bloomberg’s Covid Resilience Ranking to #36 from the 53 countries included, compared to standing at #39 in August. The news comes as government officials continue to suggest we’ll hit the peak of the pandemic’s fourth wave toward the end of October.

HAPPENING NOW- Major European indexes are firmly in the red this afternoon from Paris and Frankfurt to London and the Stoxx600. Futures suggest Wall Street will follow suit later this afternoon at the opening bell. Here at home, the benchmark EGX30 closed the day down 0.5%. Trading was light, with total turnover for the day down about a quarter from the trailing 90-day average. The selloff is providing the only glimmer of excitement on what is so far a very quiet news day in Egypt and abroad.

ALSO- Brent crude breached the USD 80 / barrel barrier for the first time in three years, building on a performance that saw it test that limit yesterday.

Why should you care if you’re not in the hydrocarbons business? The Financial Times thinks this is “the clearest signs yet that the world is heading into a global energy crunch likely to weigh on economic growth.” Prices are skyrocketing in Europe for everything from natural gas to coal and hydropower, thanks in large part to supply constraints heading into winter.

Things are getting nasty in the UK, where Boris Johnson’s government has put the army on standby after consumers drained filling stations of petrol. Officials say that supply to petrol stations is improving, but that has so far done little to reduce lineups for the pumps.

Wait — it could get worse. We can all starve, warns Bloomberg, writing that global commodities markets are being upended after crops in Brazil have been “scorched, frozen and then dried out by the worst drought in a century.” Brazil accounts for 75% of global orange exports, 54% of soy exports, 50% of sugar, 32% of coffee and 22% of worldwide corn exports.

Throw in a global shortage of tennis balls and it’s enough to make you worry that, indeed, Winter Is Coming.

LATER TODAY- Fed boss Jay Powell will speak at the Senate Banking Committee in Washington at 6pm today. Expect inflation to be very high on the agenda.

CLOSER TO HOME- Where in the world is Jake Sullivan? Axios reported last week that the White House national security advisor was due in Cairo this week as part of a Mideast tour that would also take him to Saudi Arabia and the UAE. Sullivan was scheduled to meet yesterday with Saudi Crown Prince Mohamed bin Salman. A White House statement out yesterday confirmed only that Sullivan “will travel to the Middle East, including Saudi Arabia and the United Arab Emirates,” but made no mention of a stop in Cairo.

** CATCH UP QUICK on the top stories from today’s EnterpriseAM:

  • As of today, university students can get jabbed within 24 hours of making an appointment to receive a covid-19 vaccine. The news comes as the state rolls out walk-in vaccination clinics nationwide and prepares to launch a digital proof of vaccination status.
  • State-owned banks launch EGP 1 bn+ fintech fund: Several state-owned banks will next month join forces to launch a fund to invest in fintech startups.
  • Flat6Labs raises USD 7 mn in second close for Tunisia fund: Flat6Labs announced the second close for its Tunisia-based Anava Seed Fund, during which it raised USD 7 mn, pushing the fund’s total commitments to USD 10 mn.

THE BIG STORY ABROAD- Selling pressure in global equities markets, the prospect of a global energy crisis and worries about how the Fed will unwind its stimulus program still dominate the front pages of the global business press on an otherwise quiet afternoon.

First, we all wanted to do corporate leasing. Now, everybody wants to be a BNPL player. The latest entrant to the buy-now, pay-later space is none other than Mastercard, which is launching Mastercard Installments in the US, UK and Australia in a space that “has become a battleground between banks and fintech” players. CNBC has the story. Nearly 15% of online shoppers in the west have used BNPL services according to data from Pymts. Here in Egypt, the space is being hotly contested by players ranging from banks to EFG Hermes’ valU as a sensible approach to regulation and legislation at both the CBE and the Financial Regulatory Authority have helped create a revolution in financial inclusion.

Let the new Seychelles help you hide from the tax man… The European Union is set to rehabilitate the country alongside Dominica and Anguilla by removing them next week from a list of blacklisted tax havens. Panama has apparently failed in its bid to also get off the naughty list, Reuters reports.


Today is the deadline to register for the AUC Business School’s Private Equity Diploma.

Winter retail opening hours in effect from Thursday: Shops and malls will close one hour earlier at 10pm (11pm on Thursdays, Fridays and national holidays) while cafes and restaurants will shutter at midnight rather than 1am. As during the summer, essential services such as grocery stories, supermarkets and pharmacies are exempt from the rules and can open and close their doors when they want.

Conference season continues this week:

  • ITIDA’s DevOpsDays Cairo 2021, takes place tomorrow, 29 September.
  • The Cairo International Fair opens on Thursday, 30 September at the Cairo International Conference Center. It runs through 8 October.
  • The Egypt Projects 2021 construction expo also opens on Thursday at the Egypt International Exhibition Center and wraps on Saturday, 2 October.
  • Dubai’s Expo 2020 opens on Friday, 1 October. The event, which takes place somewhere on the planet once every five years, runs for six months and will be open seven days a week. You can learn more here.

PSA #1- Next week is a short work week. You can expect to have a three-day weekend 7-9 October in observance of Armed Forces Day, which is on 6 October. Folks whose workdays are tied to banks and the market can expect confirmation from the Central Bank of Egypt and EGX early next week.

PSA #2- We’re probably also looking at a long weekend starting Thursday, 21 October in observance of the Prophet’s Birthday, which is formally Monday, 18 October.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

☀️ TOMORROW’S WEATHER- The weather will be a little bit warmer in the next two days, with the mercury maxing out tomorrow at 34°C and dropping to 22°C overnight.

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