Tuesday, July 31, 2012

Egypt watchdog suspends QInvest-EFG deal-news agency

Egypt watchdog suspends QInvest-EFG deal-news agency
CAIRO, July 25 (Reuters) - Egypt's financial regulator has suspended a joint venture deal between Egyptian investment bank EFG-Hermes HRHO.CA and Qatar's Q-Invest, approved by shareholders on June 2, the state news agency said on Wednesday.


"The Authority approved the (shareholder) assembly in form but refused it in terms of content, procedures and decisions," the head of the Egyptian Financial Supervisory Authority ( EFSA ) Ashraf El-Sharkawy was quoted as saying to the state news agency MENA.
EFSA has rejected decisions made at EFG's annual meeting last month because the firm did not clarify various points regarding the deal including the fate of minority rights after it is completed, MENA cited Sharkawy as saying.

EFG must provide the required information and re-convene the shareholder meeting so that procedures for the deal can be completed, MENA cited Sharkawy as saying.

The EFSA was not immediately available to comment.

EFG said earlier this month that the tie-up between the bank and QInvest was legally binding and could only be reversed through legal action.

EFG and QInvest sealed an agreement in May to form a joint-venture, in which state-backed QInvest would hold 60 percent. ID:nL5E8G4FMP
Economic turmoil since a popular uprising has left EFG, the Middle East's biggest home-grown investment bank, lacking the means to expand across the region. The deal with energy-rich Qatar would give it more resources for its expansion plans.
But after the QInvest deal was announced, a group of Egyptian and Gulf Arab investors -- Planet IB - - m ade a buy-out approach for EFG that the bank's management rebuffed.
ID:nL5E8GV9CC
The Planet consortium said it was prepared to pay a minimum of 13.50 Egyptian pounds ($2.23) per share for EFG, which would value it at $1.1 billion at least.
EFG's shares closed 0.8 percent lower on Wednesday. The main index .EGX30 closed down 1.5 percent. ($1 = 6.0670 Egyptian pounds)
(Reporting by Shaimaa Fayed. Editing by Jane Merriman)
((shaimaa.fayed@thomsonreuters.com)(+20 2 2578 3290)(Reuters Messaging: shaimaa.fayed.thomsonreuters.com@reuters.net))
Keywords: QINVEST/EFG

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