Back to the complete issue
Tuesday, 13 December 2022

Saudi sovereign wealth fund could finalize United Bank acquisition this year

PIF could acquire United Bank this month for USD 600 mn: Saudi Arabia’s sovereign wealth fund could acquire the state-owned United Bank for around USD 600 mn as soon as this month, Bloomberg reports, citing sources with knowledge of the matter. The Public Investment Fund (PIF) is in “advanced talks” over the acquisition and plans to purchase the bank through its Egypt-based investment vehicle, the Saudi Egyptian Investment Company, according to the business news outlet. A representative from United Bank denied having knowledge of the transaction when we asked yesterday, noting that any negotiations over a sale would go through the Central Bank of Egypt (CBE).

Refresher: Reports on the PIF’s interest in the lender have been floating around since May, with sources cited by local media saying the acquisition could close before the end of the year. The CBE owns 99.9% of United Bank, which it created in 2006 through the merger of smaller entities near the end of its well-regarded cleanup of the banking sector nearly two decades ago.

A long time coming: In 2017, the CBE said it intended to sell the bank to a strategic investor and appointed EFG Hermes and New York’s Evercore to advise on the transaction, before the covid-19 pandemic put the sale on ice.

Advisors: Reports in local media have suggested that PIF has appointed our friends at EFG Hermes as financial advisors and US law firm Akin Gump as counsel. CI Capital is reportedly acting as United Bank’s advisor.

REMEMBER- KSA is on a spending spree here in Egypt: The PIF earlier this year acquired minority stakes in four EGX-listed companies through its newly established arm for Egyptian investments in August. The buys are the first of USD 10 bn pledged by the fund earlier this year as part of Saudi efforts to support Egypt’s external position, which has been rocked by soaring commodity prices, large portfolio outflows, and a weaker EGP.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt; Hassan Allam Properties (tax ID:  553-096-567), one of Egypt’s most prominent and leading builders; and Saleh, Barsoum & Abdel Aziz (tax ID: 220-002-827), the leading audit, tax and accounting firm in Egypt.