The transaction came under the company’s three-year EGP 3 billion securitisation programme in the Egyptian debt market.
EFG Hermes acted as the co-underwriter and sole financial adviser, transaction manager, book runner, and arranger on the issuance. The Commercial International Bank (CIB) acted as underwriter and custodian of the issuance.
The company’s bond is backed by a receivable portfolio of EGP 373.9 million for the first issuance, according to EFG Hermes’ investment banking division.
It also expounded that the bond is comprised of three fixed-interest tranches, with the first divided into fixed installments while the second and third tranches to be disbursed as pass-through of the proceeds of the portfolio.
The first tranche is valued at EGP 120 million, with a tenure of 13 months, and a credit rating of (AA+) obtained from Middle East Ratings and Investors Service.
The second tranche is valued at EGP 135 million, with a tenure of three years and a credit rating of (AA), and the third tranche is valued at EGP 45 million, with a tenure of five years and a credit rating of (A).
“This issuance comes only two weeks following the funding of the EGP 750 million financing arranged and provided by EFG Hermes in late December 2021 in the form of a sale-and-lease back agreement,” said Maged El-Ayouti, the managing director and deputy head of investment banking at EFG Hermes.
This transaction is the second securitisation issuance and the third financing advisory provided by EFG Hermes for MNHD.
The first was MNHD’s debut securitisation in 2019, while the second is the EGP 750 million financing funded in late December, with EFG Hermes’ Investment Banking Division acting as the financial adviser for the transaction and EFG Hermes Corp-Solutions, a wholly owned subsidiary of EFG Hermes Holding, acting as a commissioner.
MNHD’s President and CEO Abdallah Sallam noted that such a transaction is an essential component to the company’s newly established leadership strategy.
“Our comprehensive partnership with EFG Hermes enables our company to employ broader and more sustainable financing solutions that meet our long-term expansion goals, empowering us to continue developing high-quality real estate across our Taj City and Sarai projects,” Sallam added.
The MNHD was founded in 1959 as a public real estate company. Now it’s a leading real estate development company in Egypt and has been publicly traded on the Egyptian stock exchange since 1995 under the government privatisation programme that was launched in the 1990s.
In November, the company revealed that its sales fell by 39.6 percent in the first nine months of 2021 to post EGP 2.7 billion, down from the EGP 4.5 billion recorded in the corresponding period of 2020.
The company’s revenues also declined to EGP 428.4 million in the same period.