DPI invests $35m in household appliances firm, B.TECH, Egypt

LAGOS, Nigeria, Capital Markets in Africa: Development Partners International (DPI), one of the leading African private equity specialists with US$1.1bn under management, has through its ADP II fund concluded an investment and strategic partnership with Egypt’s leading household appliances and consumer electronics retailer, B.TECH, that will see the fund investing EGP300mn in the company. 

B.TECH operates a fast-growing portfolio of 67 retail stores across 22 governorates in Egypt with a network of 362 wholesale dealers supported by three main warehouses and 57 after-sales service centres. B.TECH distributes leading household appliances and consumer electronics products including leading global brands such as Indesit, Ariston, Miele, Apple and Braun.

B.TECH has consistently grown its business at an impressive 18% annualised sales growth over the last 5 years driven by growing demand for consumer durables and electronics from Egypt’s middle class. Sales are supported by B.TECH’s market leading instalment payment system which has served over 700,000 Egyptians to date. B.TECH’s unique combination of physical retail, instalment payments, and a fast-growing online presence supported by an advanced warehouse and after-sales capability gives the business a dominant position serving customers across a broad demographic range. 

Runa Alam, CEO and co-founder of DPI, commented: “Our investment thesis is to back strong companies which serve the developing needs of the emerging middle class across Africa. B.TECH is our first investment in Egypt and has a proven track record in serving the needs of the emerging and established middle classes. We believe the shift from traditional towards organised retail and the increasing formation of new households will support increasing consumption of durables and open new markets and channels for the business.”

Adding to this, DPI deal partner Sofiane Lahmar said: “ B.TECH has a strong track record of growth and profitability, an excellent management team, and a clear long-term strategy. We are excited to partner with Dr. Khattab and his team and look forward to working together with B.TECH to continue the company’s growth story in Egypt and expand outside of Egypt in other African countries.” 

Dr. Mahmoud Khattab, Chairman, and CEO of B.TECH added: “B.TECH has grown over the last ten years to be the leading household appliances and consumer electronics retailer in Egypt with a distribution platform that is second to none. B.TECH’s unique integrated business model offers a strong value proposition to its customers in terms of a range of products, affordability and accessibility across the country both offline and online. The investment and partnership between our company and DPI demonstrate the outstanding work accomplished by our team and highlights the growth potential of B.TECH in Egypt and Africa.” 

Matouk Bassiouny and Norton Rose Fulbright LLP acted as legal counsel to DPI on the transaction. 
B.TECH was advised by EFG Hermes, Zulficar & Partners and White & Case on the transaction.