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Monday, 13 June 2022

Bidding war over Beltone afoot?

UAE’s Chimera puts in an offer for Beltone: Our friends at Abu-Dhabi based investment firm Chimera Investments have submitted a non-binding offer to acquire a controlling stake in Beltone Financial, according to a statement (pdf) by the Financial Regulatory Authority (FRA) and disclosures by Chimera (pdf) and Beltone (pdf).

The breakdown: Chimera is bidding to acquire 51-90% of Beltone at an initial price of EGP 1.49 per share, valuing the firm at some EGP 690 mn by our math.

This is the second acquisition offer Beltone has fielded in as many weeks: An investor alliance led by WM Consultancy last week put in its own offer to acquire a 51-90% stake in Beltone at EGP 1.35 a piece.

Chimera has pitched its offer exactly 10% higher than WM’s bid, and at more than a 40% premium to Beltone’s share price before the news of WM’s offer broke.

Beltone’s shares fell 0.96% to EGP 1.138 yesterday. Shares are still up more than 9% since WM’s bid was announced at the start of last week.

What’s next: A final offer is pending regulatory approvals in Egypt and the UAE, according to the statements.

Beltone has already given the green light for the WM-led consortium to conduct due diligence, it said last week. The consortium will need approval from the FRA before it can start due diligence. WM Consultancy is led by former Beltone exec Wael Mahgary.

Who owns Beltone today? Orascom Financial Holding (OFH) currently owns 58% of Beltone, with the rest in freefloat, according to the company’s website. OFH has been lowering its stake in Beltone over the past couple of years, after holding a majority of 74.5% of the company in 2020.

This comes on the back of another loss making year for Beltone: The company’s net losses widened to EGP 169.8 mn in 2021, from EGP 132.4 mn the previous year, according to the firm’s financial statement. Revenues rose 27.1% y-o-y in 2021, recording EGP 351.7 mn.

Advisors: Chimera has tapped Matouk Bassiouny & Hennawy as legal counsel to the Abu Dhabi-based fund, according to its statement.

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