What:
Act Financial, a seasoned player in the investment management arena, is pretty close to debuting on the EGX. According to reports from Al Borsa News, the firm is gearing up to offer a minority stake valued at EGP 1 billion.
The Mechanism:
Act Financial is funding its expansion via a capital increase. Essentially, rather than selling existing shares, the company plans to issue fresh shares to raise the desired capital. This means no existing shareholders are parting with their ownership stakes; instead, Act Financial is baking a new cake to bring in new investors.
Claps Class:
Picture this — instead of slicing up the existing pie (selling existing shares) — Act Financial decides to bake a new, larger pie (issuing new shares). This allows the company to secure additional funds without diluting the ownership of its current shareholders.
Now What:
Act Financial has already filed a temporary listing request with the EGX and is eagerly awaiting approval from the listing committee. Once given the green light, the company will finalize the size of the stake to be offered, based on insights from its financial advisor.
Some Context:
This move isn’t out of the blue. Reports earlier this week hinted at Act Financial’s IPO plans, slotted for Q2-24. And it was first mentioned by Managing Partner and Cofounder Mostafa Abdel Aziz back in September 2022, hinting at a potential offering of up to 40% of the company’s shares on the EGX.
Act Financial’s Backstory:
Almost a decade old, Act Financial specializes in diverse equity investments, including buyouts, leveraged acquisitions, and a range of liquid and illiquid opportunities. It emerged in the Egyptian market with a unique model of direct investment, focusing primarily on contributing to EGX-listed companies.
Its first major move was its alliance with Orascom Holding Company (formerly) to acquire a majority stake in Beltone Holding Financial, followed by investments in several companies, the latest being SODIC. According to Al Borsa News’ sources, Act Financial’s investment portfolio and its affiliates have currently exceeded about EGP 5 billion.
