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Sunday, 17 October 2021

Egytrans walks away from HAUH takeover bid

Egytrans pulls the brakes on HAUH takeover: A potential reverse merger between Egytrans and Hassan Allam Utilities Holdings (HAUH) subsidiary Hassan Allam Utilities BV appears to have fallen through after the two sides failed to agree on a fair value, the transportation firm said in an EGX disclosure (pdf). The shelved agreement would have been key to Hassan Allam Utilities’ expansion into transportation. Back in March, Egytrans had accepted an offer submitted by HA Utilities to acquire a controlling stake in the company via a share swap that would have seen Egytrans acquire 100% of HA Utilities BV in exchange for HAUH acquiring a 65% stake in Egytrans. HA Utilities BV had been valued at EGP 721.5 mn in a fair value assessment by Grant Thornton, while Egytrans’ shares were set at EGP 12.90 apiece, bringing its total value to EGP 414 mn.

It’s unclear how the transaction subsequently fell apart, but Egytrans has had more than one suitor: After opening talks with HAUH, Egytrans appeared to have attracted interest from Paradigm Logistics as well, but the potential Paradigm transaction fell through in May. Paradigm was willing to pay EGP 460 mn — which was higher than the EGP 414 mn HAUH had initially offered — but the Financial Regulatory Authority (FRA) stepped in and broke up the party. Paradigm had proposed to swap its 72% stake in shipping company Ostool, in exchange for new shares in EgyTrans, but the FRA said the offer had no grounds since Paradigm apparently never completed its purchase of stake in Ostool and was still paying it off. Egytrans then returned to the negotiating table with HAUH, but it is unclear whether HAUH made changes to its bid.

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