Saudi electronics retailer Extra plans to spend EGP 1 bn to launch in Egypt, marking the company’s first expansion outside the GCC region, Extra said in a Saudi regulatory filing. The Tadawul-listed company — formally known as United Electronics Company and one of the largest consumer electronics companies in the region — will establish a subsidiary in Egypt under plans approved by the board last week, as it looks to tap the biggest consumer market in the Middle East.

Extra is targeting a 10% market share in Egypt over the next decade, CEO Muhammad Jalal told CNBC Arabia, adding that the local Egyptian market is worth around SAR 25 bn (c.USD 6.7 bn).

The company will finance the expansion with a mixture of equity and debt: Extra (which writes its name as eXtra) will fund the initial investment through a mixture of self-financing and borrowing, according to the disclosure, which said to expect further announcements on the details as they develop. CNBC Arabia yesterday reported Jalal as having said the Egyptian subsidiary would be wholly self-financed with company equity, while adding that additional financing could be made available if necessary. He said the company generally targets a 1:1 debt-to-equity ratio in its investments.

eXtra’s footprint: The company currently has 42 stores across Saudi, a store in Bahrain, and another in Oman, and will also be adding four stores in Saudi Arabia and Oman. It’s also investing in a new distribution center for its e-commerce business.

The decision to invest in Egypt comes on the back of solid earnings in 2021, with the company reporting (pdf) a 52% y-o-y increase in net income during the first nine months of the year.