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Monday, 4 April 2022

Offshore group including company execs make a play for Domty

Domty up for grabs: A group led by Expedition Investments has submitted a non-binding offer for a majority stake in cheese maker Domty, the company announced in a statement (pdf) to the EGX. The group is looking to acquire up to 90% of the food producer at EGP 5.00 per share, according to a statement by the FRA to the bourse. The transaction could be valued at nearly EGP 1.3 bn if it goes through, based on our math.

Domty’s shares soared 14.2% on the back of the offer to close at EGP 4.50 apiece yesterday.

So who’s mounting the bid? Investors from Egypt and the Gulf, according to a source close to the transaction. Execs who are members of the Domty’s founding family, including Omar El Damaty (the company’s current chairman and MD) and Mohamed El Damaty (vice-chairman) are also on board and hold minority stakes in Expedition. The company is domiciled in Mauritius and counts veteran investment banker Mohamed El Akhdar as a board member. It was established on 21 March, according to the Mauritius company register.

Expedition wants to do the due diligence process on Domty “as soon as possible,” a company statement said, with a mandatory tender offer contingent on the outcome of due diligence and regulatory approvals.

Domty isn’t being expatriated, our source tells us. Though Expedition is an offshore special purpose vehicle, this transaction is about private equity changing hands, not a relocation for the Egyptian firm. Mauritius is a common jurisdiction for takeover vehicles that have raised foreign capital as well as for funds raised by private equity firms.

Matouk Bassiouny & Hennawy is advising Expedition, according to the statement..

Expedition will have more to say about the transaction in the coming weeks, our sources tell us.

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