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Thursday, 22 September 2022

Bids for Alex Medical aren’t adding up + B Investments approves fair value study ahead of Giza Systems sale

A tale of two fair value studies: Things are not looking up for the Tawasol Holdings-LimeVest consortium’s bid to acquire Alex Medical, as a fair value study from Andersen adds weight to the board’s suggestion that the bid undervalues the company. Meanwhile, B Investments could close the sale of its stake in Giza Systems to a Saudi Telecom subsidiary within weeks, after giving its thumbs up to a fair value study from BDO.


Andersen values Alex Medical some 8% higher than Tawasol-LimeVest’s acquisition bid: A fair value study has valued Alexandria Medical Services above the two recent offers for the company submitted by the Tawasol Holdings-LimeVest consortium and Yas Holdings, the company said in a disclosure (pdf) to the bourse. The study, conducted by Alex Medical’s financial advisor Andersen, has put the company’s per-share price EGP 52.80, 7.8% higher than the EGP 49.00 offered in Tawasol-LimeVest’s ongoing mandatory tender offer and 8.6% above Yas’s competing bid of EGP 48.62 per share. Andersen values the company at EGP 821.8 mn.

Alex Medical’s board has made its views on the Tawasol-LimeVest bid clear: The valuation come a day after the Alex Medical board signaled a thumbs down on the consortium’s bid to acquire up to 74% of the company, saying the offer doesn’t reflect the average share price of the company for the six months preceding the launch of the MTO. The board has yet to discuss the Yas offer, which is pending healthcare-sector specific approvals and the greenlight from the Financial Regulatory Authority.

The Tawasol-LimeVest MTO is ongoing until 27 September. It is unknown how many shareholders have agreed to sell their shares to the consortium. Abu Dhabi Commercial Bank owns a 51.5% stake in Alex Medical and had reportedly been interested in making an exit last year, when more than eight companies (including Tawasol-LimeVest and Yas) joined a bidding war for the company that ultimately ended without a sale. Given ADCB’s board representation, it might not be looking good for the consortium’s bid.

Advisors: Prime Holding are the brokers on the Tawasol-LimeVest offer and Zaki Hashem and Partners are acting as the consortium’s counsel. Al Ahly Pharos is reportedly Yas’ financial advisor on the transaction.


B Investments approves Giza Systems fair value study ahead of exit: B Investments has given a thumbs up to a fair value study (pdf) of Giza Systems it commissioned from financial advisor BDO ahead of selling its stake in the company a subsidiary of Saudi Telecom (STC), according to a statement (pdf) to the EGX yesterday. The study puts Giza Systems’ equity value at around EGP 1.8 bn (USD 93 mn), or EGP 202.10 per share.

Close approaching: The final equity value of the transaction will be determined when it closes, which should be within three weeks, B Investments IR head Omar El Labban told Enterprise.

B Investments is making a full exit from Giza Systems, after in April accepting an undisclosed binding offer for its 44.7% stake from Solutions by STC. The offer puts an enterprise value (the total worth of the company including debt and cash balance) on Giza Systems of USD 145 mn.

REFRESHER- Solutions by STC is on course to take an 89.5% stake in Giza Systems from SPV Inergia Technologies, in which B Investments is the majority shareholder. Inergia holds a 65.7% stake in Giza Systems (including B Investments’ stake). It’s not known who the other sellers are.

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