EFG Hermes, the leading investment bank franchise in Frontier Emerging Markets (FEM), announced on Sunday that its investment banking division successfully closed an EGP 500m bond issuance for its subsidiary EFG Hermes Corp-Solutions. The transaction is part of a wider EGP 3bn bond programme for the leasing and factoring player.
The bond, which received a credit rating of “A-” from Middle East Ratings and Investor Services (MERIS), is comprised of two tranches – with tranche A valued at EGP 450m with a tenor of 24 months and Tranche B valued at EGP 50 million with a tenor of 24 months.
Commenting on the issuance, Maie Hamdy, Managing Director of Debt Capital Markets at EFG Hermes said: “We are delighted to have advised EFG Hermes Corp-Solutions on its first bond issuance. With the CBE hiking interest rates to curb inflationary pressures, the need for alternative corporate financing solutions continues to grow in tandem in our home market. At the same time, bonds in every corner of the global debt market are recovering as investors turn toward fixed-income assets once again. As we deepen our DCM service offering, we pride ourselves on our ability to respond to market shifts with deft and agility, providing our ever-growing roster of clients with carefully honed advisory and bespoke solutions tailored to their needs and risk appetites as well as market dynamics.”
“This transaction marks yet another major milestone for EFG Hermes Corp-Solutions as we continue to garner significant traction from investors due to the strength of our operations and the soundness of our blueprint for growth,” said CEO of EFG Hermes Corp-Solutions, Talal El Ayat, “This issuance is part and parcel of our strategy to deepen our presence in the market, allowing us to finance our operational growth targets and execute on plans to expand and diversify both our leasing and factoring service offerings to reach a wider segment clients looking for sources of alternative corporate financing.”
The issuance falls in line with EFG Hermes Corp-Solutions’ strategy to broaden its client base across its operational footprint. At present, EFG Hermes-Corp Solutions enjoys a healthy and diverse client mix of 20% SMEs and 80% mid-cap to large corporations. The company’s clientele operates across an expansive range of industries, including real estate development, logistics and maritime, printing and packaging, education, and healthcare. On the factoring side, the majority of Corp-Solutions’ SME clients operate in the Trading and Distribution industry, followed by Transportation and Logistics. On the leasing side, the education and real estate industries have the lion’s share, with the healthcare sector coming in at third place. This year and for the years to come, the company aims to focus on adding on more SMEs to its roster of clients.