Cairo, Egypt – September 3, 2023 – Global Investment House, an Emirati investment firm, has signed an agreement to acquire a 30% stake in Egypt’s Eastern Company, a leading tobacco company.
Dr. Mostafa Madbouly, the Prime Minister, during the signing of the deal-Image Source: Sky News
The deal, worth $625 million, is the latest in a series of efforts by the Egyptian government to privatize state-owned enterprises and attract foreign investment.
The agreement was signed by Emad Eldin Mustafa Khaled, CEO of the Egyptian Chemical Industries Holding Company, and Sheikha Lubna Al Qassimi, a representative of Global Investment House.
Under the terms of the agreement, Global Investment House will pay $625 million for the 30% stake in Eastern Company, which is equivalent to 19.3 billion Egyptian pounds. The company will also provide $150 million to purchase tobacco products for manufacturing.
The deal is in line with the Egyptian government’s efforts to broaden the ownership base of state-owned enterprises and encourage private investment. It is also expected to help develop the tobacco industry and stabilize the market.
| Deal | UAE’s Global Holding acquires 30% stake in Egyptian Eastern Company |
|---|---|
| Value | $625 million |
| Buyer | Global Holding |
| Seller | Egyptian government |
| Additional investment | $150 million for purchasing tobacco materials |
| Retained stake | 20.9% by Egyptian Holding Company for Chemical Industries |
The acquisition of Eastern Company by Global Investment House is a significant development for the Egyptian economy. It is the largest foreign investment in an Egyptian state-owned enterprise since the government launched its privatization program in 2021.
The deal is expected to provide a number of benefits for both parties. Global Investment House will gain a foothold in the Egyptian tobacco market, which is the largest in Africa. The Egyptian government will receive much-needed revenue from the sale of the stake in Eastern Company.
The deal is also a sign of the growing confidence of foreign investors in the Egyptian economy.
