EFG Hermes shares jump 16% after FAB’s offer

Inayat-ur-Rahman, Business Editor


EFG Hermes Holding shares jumped by 15.95 per cent after an offer from First Abu Dhabi Bank (FAB) to acquire the group’s shares, traded at 18.25  Egyptian pounds.

Financial Supervisory Authority got a statement of disclosure announcing the desire of “First Abu Dhabi Bank” FAB, to submit a non-binding purchase offer to acquire a majority of no less than 51 per cent of “EFG Hermes Holding” shares listed on the stock exchange.

Today, the Financial Supervisory Authority received the first letter of First Abu Dhabi Bank regarding the disclosure of their intention to submit a non-binding offer to acquire a majority percentage of no less than 51 per cent of  EFG Hermes Holding  shares in compliance with the provisions of Chapter Twelve of the Executive Regulations of the Capital Market Law 95 of 1992.

The company will also start the due diligence procedures at the earliest date possible. FAB offered 19 Egyptian pounds  per share, a premium of about 21% to where EFG was trading before it was suspended on Wednesday, until the due diligence procedures is done.

The decision to submit the purchase offer or not is subject to  the results of the due diligence procedures, as well as fulfilling the necessary procedures and obtaining the relevant internal and administrative approvals from the  authorities within the Arab Republic of Egypt and the United Arab Emirates.

The stock exchange decided to re-trade the company’s shares as of 10:20 am from today’s trading session.

EFG Hermes stock rose by 2.14% at the close of trading yesterday, to be traded at 15.84 pounds,  the highest price per share in two years since November 2019.

The trading transactions topped EGP74.8m during the session, absorbing a large ratio of market liquidity, and going up despite the stock market indices decline during the session.

“Prime Securities “said EFG Hermes has shown some signs of recovery in 2021, as capital markets begin to recover after the COVID-19 pandemic during 2020.

Their positive recommendation for the stock  , as they say,is due to the strong growth resulting from three factors represented in the expansion of the non-banking financial services platform, as all non-banking financial services were profitable and robust, resulting in 48% of the group’s net profit in the first quarter of 2021.