Egypt’s Sarwa Capital Seeks Raising About $120 Million in IPO

CAIRO (Capital Markets in Africa) – Sarwa Capital, an Egyptian consumer and structured-finance provider, plans to sell a stake of as much as 40 percent in an initial public offering to raise capital for expansion.

The Cairo-based company plans to list the shares on the local stock exchange in early October, Chief Executive Officer Hazem Moussa said in an interview. The company will use the proceeds, expected to be about $120 million, to grow consumer and retail financing, mortgages, leasing and corporate bonds and to start insurance and factoring businesses, he said.

“There is a lot of growth potential even in our existing historical core business of car financing but also in other relatively new businesses,” Moussa said from his Cairo office. “The penetration levels are extremely low, there is so much to do and we are looking to expand and grow.”

Boosting small- and medium-sized enterprises and broadening access to financing have become priorities for Egypt as the government looks to boost economic growth. Authorities have launched initiatives at promoting non-traditional financing tools.

Sarwa Capital will start a roadshow for the IPO late this month and will visit the U.S., Europe, South Africa and Gulf countries. Beltone Financial is global coordinator and bookrunner for the offering.

“It has been a challenging environment, yet we have grown aggressively,” Moussa said. “That should give us a base for the coming period after the market stabilizes in terms of interest rates and inflation and demand starts to pick up more again.”

Source: Bloomberg Business News