An Abu Dhabi wealth fund agreed with Egypt to invest about $2 billion by buying state-held stakes in some companies, including the North African nation’s largest listed bank, according to people familiar with the deal.
Part of the agreement with ADQ involves it buying about 18 percent of Commercial International Bank, said the people who asked not to be identified as the talks are confidential.
Along with the CIB portion, which comprises about half the overall deal, ADQ is buying stakes in four other companies listed on Egypt’s stock market, including Fawry for Banking and Payment Technology Services SAE, the people said.
ADQ was not available to comment, while Fawry declined to comment.
Such funding would be welcome for Egypt, where the economy is being put under increasing pressure from the shockwaves of Russia’s invasion of Ukraine. The central bank held a special policy meeting Monday and hiked interest rates for the first time since 2017, while the currency weakened sharply.
Fitch Ratings has warned the conflict in Ukraine will cause “reduced tourism inflows, higher food prices and greater financing challenges.”
Egypt and the UAE set up a $20 billion joint strategic platform in 2019 to invest in a range of sectors and assets. It’s run through Egypt’s sovereign wealth fund and ADQ.
The North African country is also in talks with the International Monetary Fund on possible support that could include a loan, according to people familiar with those discussions.
ADQ last year bought an Egyptian pharmaceuticals company from Bausch Health Cos., while also investing in a UAE supermarket chain expanding in the North African country. Aldar Properties PJSC, backed by Alpha Dhabi Holding PJSC, meanwhile agreed to buy an Egyptian developer known as Sodic.
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