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Sunday, 13 February 2022

Macro marks EGX debut, says it’s eyeing an acquisition this year

Leading cosmeceutical outfit Macro Group is doing due diligence on an acquisition with an eye to completing the transaction this year, Al Borsa quotes CEO Hisham Wasfy as saying at a press conference on Thursday after the company made its EGP 1.3 bn EGX debut. The company had acquired a nutritional supplement company in 4Q2021, Wasfy also said, without disclosing the name or value of the acquisition.

The IPO: Macro’s IPO saw it sell 264.5 mn shares (equivalent to a 45.8% stake) at EGP 4.85 apiece, valuing the company at around EGP 2.8 bn. Shareholder Leo 1 — a special purpose vehicle that held 99.9% of Macro — sold the shares in a secondary sale, according to a statement (pdf) from EFG Hermes, which quarterbacked the transaction. Shares in the cosmeceuticals firm rose as much as 15% on Thursday before falling back to close at EGP 4.51, below their EGP 4.85 opening price.

Strong investor interest: The IPO saw around 5.6k investors participating in the retail and institutional offerings, according to an EGX statement (pdf), around half of whom were new investors. The institutional offering — which was allocated 95% of the shares — was 1.8x oversubscribed, while the retail component saw stronger demand, closing 102x oversubscribed.

IPO momentum picking up? Macro’s debut on the bourse marks our second IPO of the year, after Al Khair River for Development and Investment (aka Nahr El Khair) got the ball rolling last month. Macro’s IPO comes as the government is gearing up to revive the state privatization program this year, with Prime Minister Moustafa Madbouly, Planning Minister Hala El Said, and Finance Minister Mohamed Maait all signaling over the past couple of weeks that we should expect to see several state listings this year. Maait pledged last month to restart the privatization program in March, a few days after El Said said that the government could sell stakes every month or two.

Advisors: Our friends at EFG Hermes quarterbacked the transaction as sole global coordinator. EFG Hermes and Renaissance Capital acted as joint bookrunners, while White & Case was counsel to the issuer. Dechert and Zaki Hashem & Partners were counsel to the joint bookrunners, while PwC was appointed external auditor. Inktank was investor relations advisor.

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