EFG Hermes Successfully Concludes Advisory on Latest EGP 750 Million Financing Transactions for MARAKEZ’s Mall of Arabia
-The transaction is part of a wider EGP 2.25 billion financing package arranged by EFG Hermes’ Investment Banking division and EFG Hermes Corp-Solutions for MARAKEZ
-The agreement capitalizes on cross-selling products across the group, with EFG Hermes Corp-Solutions acting as leasing partner and aiBANK’s participation
EFG Hermes, the leading investment bank franchise in Frontier Emerging Markets (FEM), announced today that itsInvestment Banking divisionsuccessfully closed advisory on the latest EGP 750 million financing over two tranches in a sale and leaseback package for MARAKEZ, one of the largest mixed-use developers in Egypt. The divisionacted as the sole financial advisor and arranger on the transaction, while EFG Hermes Corp-Solutions, a wholly-owned subsidiary of EFG Hermes Holding and one of Egypt’s leading leasing and factoring companies,acted as the leasing partner and EFG Hermes’ recently acquired aiBANKacted as the lender.
The transaction comes as part of a wider EGP 2.25 billion financing package at the level of Mall of Arabia, MARAKEZ’s mega-mall located in 6thof October, covering a vast area of over 620,000 sqm. Mall of Arabia hosts a wide array of premium local and international brands, in addition to a residential development.
The participation of aiBank
The participation of aiBANK in the transaction alongside EFG Hermes’ Investment Banking division and EFG Hermes Corp-Solutions marks a key milestone in the group’s journey of collaboration, cross-selling, and the creation of synergies between its business lines to better serve its clients.
Maged El Ayouti, Managing Director and Deputy Head of EFG Hermes’ Investment Banking division,commented, "We are proud to have carried on our role as trusted partners in our long-standing relationship with MARAKEZ in their EGP 2.25 billion financing transactions over the past two years. This transaction is a testament to our ability to seamlessly cross-sell products across EFG Hermes, with this transaction seeing the first-time participation of both EFG Hermes Corp-Solutions and aiBANK alongside the Investment Banking division, cementing our positioning as a one-stop-shop for our clients’ ever-evolving financing needs. This latest funding marks as a steppingstone towards tapping the local debt capital market (EGX) in the near future through prospective financing that capitalizes on the strong asset profile and robust cash flow generation of MARAKEZ’s landmark property, Mall of Arabia.”
A strategy of forging partnerships
Talal El Ayat, CEO of EFG Hermes Corp-Solutions, said “Collaborating with a leading real estate development such as MARAKEZ is essential to our strategy of forging partnerships across industries that support our client’s growth plans through expanding their financing solutions. We are excited for the success of this transaction, which has maximized the benefits of our cross-selling power to allow us to add value through ourpremium financing opportunitiesto one of Egypt’s most rapidly expanding sectors that continues to profit from strong demand and solid growth.”
Providing support to MARAKEZ
Tamer Seif, CEO and Managing Director of aiBANK, commented, “We are extremely delighted to have collaborated with other subsidiaries across EFG Hermes Holding to provide support to MARAKEZ, allowing us to diversify our portfolio and increase our exposure to high quality, income-generating businesses. This transaction is part and parcel of our strategy to expand our offering and venture into new spaces through forging lucrative partnerships across key industries such as real estate, helping provide necessary financing for major projects across the country.”
Basil Ramzy, CEO of Marakez, said “This collaboration comes within our strategy to join hands with established partners that further consolidate our leading market position and boost our expansion plans in Egypt and beyond it. EFG Hermes is a longstanding partner of MARAKEZ and the current transaction is a testament to our solid financial performance and certainly advances our growth in new directions and landscapes.”
A series of advisory assignments
The transaction is a continuation to a series of advisory assignments successfully concluded for MARAKEZ by EFG Hermes to support the Group in funding its developments and, in turn, maximizing shareholder value. MARAKEZ has proven to be a resilient player in the real estate sector over the years, underpinned by a strong recurring income revenue base, and this transaction is proof of their sound financial performance and position in the market.
This transaction with MARAKEZ comes on the heels of an EGP 1.5 billion financing arranged for ODE’s O-West and an EGP 425 million securitized bond issuance for Pioneers Properties for Urban Development that were both concluded last month. It reinforces the leadership position of EFG Hermes’ Investment Banking division in the real estate sector across debt, equity raising, and M&A transactions, having concluded a series of transactions in 2022 involving advisory on Bedaya Mortgage Finance’s first securitization issuance, advisory and arrangement on an EGP 1.05 billion sale and leaseback agreement and a securitization issuance for MNHD, Egypt’s debut Sukuk issuance for TMG, and LMD Visionary Real Estate Development Company financing.
In 2021, EFG Hermes successfully advised on a series of securitization transactions for leading real estate developers, namely for TMG, MNHD, SODIC, Misr Italia Properties, Pioneers Properties, amongst other transactions. Additionally, it concluded advisory for SODIC, a premier real estate developer in Egypt, on the sale of 85.5% of its EGX-listed shares through an MTO to a consortium comprised of UAE’s Aldar Properties and ADQ in a deal worth around USD 388 million.
