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EGX: Commencement Of Trading On Sarwa Capital Shares

Date 22/10/2018

The   Egyptian   Exchange’s   (EGX)   trading   platform   received   the new   company   number   226,   Sarwa   Capital   to   be traded   on main  market’s  platform  in  the  presence  of  Mr.  Mohamed  Farid, EGX   Chairman,   Sarwa   Capital’s   executives and   representatives of     Beltone     Financial     Holding     the,     the     company’s     global coordinator and Bookrunner;  it will  be  traded  with  the  symbol "SRW.CA".

The   IPO   and   private   placement   have   been   implemented   for 295.2  million  shares,  representing  47.2%  of  the company's  shares at  the  price  EGP  7.36  per  share,  worth  a  total  value  of  EGP  2.2 billion.

The  total  number  of  the  IPO  shares  is  29.5  million  shares representing   10%   of   the   shares   offered   representing approximately  4.7%  of  the  total  company’s  shares,  while  the number  of  private  placement  shares  is  265.6  million shares representing  90%  of  the  total  shares  offered,  representing  42.5% of the total company’s shares.

The IPO was covered 30.1 times, which results in allocation ratio of 3.3%. The total shares bids was 887.4 million shares requested in 2306 orders for 2271 customers, while the private placement was covered 10.8 times worth total bids EGP 21 billion.

The percentage of non-Egyptians "Arabs and Foreigners" in the Private Placement & IPO is 52.3%, while the Egyptians’ percentage is 47.7%.

Mohamed Farid, EGX Chairman, stated that EGX management continues to provide all the needed support and assistance to companies  from  the  various  sectors  which  are  wishing  to  grow through   the   stock   market;   this   goes   in   line   with   the   country’s plans to achieve sustainable economic growth.

The EGX  Chairman  said,  "The  total  IPOs  executed  during  the  past  9 months  of  2018  amounted  to  EGP  5.2  billion distributed  over  4 IPOs  in  the  different  sectors,  compared  to  a  total  IPOs  of  2017 worth EGP 3.9 billion."

Farid  stated  that  the  diversity  of  stocks  at  EGX  strengthens  its  role in supporting the economic development process currently implemented by the government to reform the economic path.

Moreover,  Farid     welcomed     companies     from     the     different sectors  to  list  on  the  stock  exchange  to  acquire  the necessary funding  to  support  their  investment  plans  and  to  pave  the  way for  them  to  enter  new  markets.  He  also assured  that  EGX management   saves   no   effort   to   develop   the   trading environment and to facilitate all the procedures to enhance the market’s  liquidity  and  trading,  and  to  increase  depth  of  Egypt’s capital market.

The EGX Chairman  highlighted   that  the   high   demand   of  the   Arab and  foreign  investors  representing  52.3%  of  the  IPO  reflects  the trust  in  the  Egyptian  market.  It  is  a  clear  message  that  Egypt  is on   the   right   path   through   implementing   reforms   at   all   levels; financial, monetary and legal.

Bassem Azab, Beltone’s Managing Director, the global manager of the IPO, said that the IPO witnessed a great interest from institutions and individuals both inside and outside Egypt, which was evident in the private placement coverage rates that reached 11 times and the IPO that was covered 30 times.

Azab also pointed out that Beltone always seeks providing the Egyptian market with companies of future. Hence, Sarwa Capital is one of the most attractive companies for institutional investors in the Egyptian market due to several factors which are the free float trading percentage that will reach about 47% after the finalizing its capital increase. Additionally, the company’s growth rate is an average of 52% over the past five years; taking inconsideration that a limited number of companies in the Egyptian market achieves the same percentage.

Furthermore, the consumer finance sector in which the company operates is considered one of the fastest growing sectors in the upcoming years due to its low penetration levels in a market whose population exceeds 100 million.

Finally, Mr. Hazem Mousa, Chairman and Managing Director of Sarwa Capital, said: "The begining of trading on the company's shares at EGX is a step that enhances the company’s growth opportunities." He looks forward at completing the company's expansion strategy to achieve the anticipated objectives.