CAIRO: GB Auto, Egypt’s biggest listed automobile assembler, said on Sunday it plans to launch a finance company offering loans to car buyers in a move to expand its sources of revenue.
The finance company, Drive Car Trading, will be launched in the second quarter with 50 million Egyptian pounds ($8.4 million) in capital.
It plans to expand the unit’s capital to LE 150 million after five years depending on business growth, GB Auto said.
GB Auto said it intends to "diversify its revenue stream base" to cover consumer finance and after-sales.
"The launch of a consumer finance venture is a natural progression of our strategy… We are particularly excited to expand our product range to include the financing of Hyundai and Mazda passenger cars," said Raouf Ghabbour, chief executive of GB Auto.
"Drive Car Trading" will start out serving GB Auto’s Hyundai and Mazda passenger car outlets but will later expand to finance retail client purchases of brands not distributed by GB Auto.
The company said its net profit fell 55 percent in the fourth quarter of 2010, before political unrest that began in January, while for the whole of 2010 it rose 28 percent.