EFG Hermes has initiated floating a 36% stake of Fawry on the Egyptian Exchange (EGX) at a price of EGP 6.46 per share, four piasters below its fair value of EGP 6.9.
The private placement was opened to institutional investors two days ago through to 31 July, while individual will be able to buy starting from 28 July to 5 August. Trading on the share begins by 8 August.
The subscription rate for institutional investors is 10% of the company’s 254.6 million shares, while the individual investors account for only 5%, after the company offered about 21% stake to strategic investors, where the National Bank of Egypt and Banque Misr bought 7% each.
According to Fincorp Investment Holding, the independent financial advisor for the offering, the company is expected to achieve revenues of EGP 869.4m at the end of 2019 with a growth rate of 42.6%. Revenues will rise to EGP 1.21bn by the end of 2020 with growth of 39.2% to reach EGP 1.7bn in 2021, an increase of 38.2%.
Mohamed Okasha, managing director of Fawry, said the next few days will show the extent to which investors are responding to the offer, which is expected to be a good success, supported by the company’s leadership in the field of electronic payments and the expected good financial results, along with the new activities the company plans to enter in the coming period.
Okasha revealed that Fawry is expected to launch insurance brokerage activity during the fourth quarter (Q4) of this year, in which the company will implement requests for insurance brokerage electronically, stressing that Fawry seeks to benefit from the digital transformation in transactions, to allow transactions of all forms in non-cash means. The Fawry insurance brokerage company will be wholly owned by the parent company.
Fawry Consumer Goods Payment Solutions is also expected to grow its activity in the coming period. This company was recently established in partnership with BI-Technologies to link Sales Buzz app with its FMCG platform, which will create a digital community for consumer goods merchants and companies.
The FMCG platform currently serves 96,000 Fawry traders and hundreds of consumer goods companies.
The most prominent brands are Coca-Cola, Juhayna, Beyti, Mars, Domty, and other well-known brands.