Investment bank EFG Hermes has signed a binding agreement to acquire 76.7% of Tanmeyah Microenterprise Services, a provider of microfinance solutions to business owners across Egypt.
Under the EGP345m ($43.9m) deal, EFG Hermes will buy a 70% interest owned by Qalaa Holdings’ Finance subsidiary.
The bank will also purchase a portion of the shares held by Tanmeyah’s management, representing a further 6.7% of the company.
The transaction is subject to regulatory approvals including the consent of the Egyptian Financial Supervisory Authority and the satisfaction of certain conditions precedent.
Tanmeyah provides financial services and promotes financial inclusion via micro-enterprise lending and very small enterprise lending as well as payment solutions available through its branch network.
The company currently employs over 1,500 people. Since its inception in 2009, the company issued loans totalling EGP3bn to more than 356,000 clients.
Tanmeyah reported a 46% year-on-year surge in revenues to EGP133m in 2015. Net profit grew 29% to EGP 42m.
EFG Hermes Group CEO Karim Awad said: "The acquisition comes as the first of a number of strategic moves that EFG Hermes intends to undertake during the coming 12 months and that will put in place the foundation for the firm’s growth over the coming five years."
After completion of the transaction, Wael Ziada will be appointed as CEO of EFG Hermes Finance.
Wael will be responsible to streamline operations and establish synergies between Tanmeyah and EFG’s future expansion into new finance product lines.
Image: EFG Hermes signed a binding agreement to acquire 76.7% of Tanmeyah Microenterprise Services. Photo: courtesy of adamr/FreeDigitalPhotos.net.