Sunday, 19 June 2011 at 15:24, Bloomberg
Citadel Capital SAE, an Egyptian private equity firm with $4 billion in assets under management, headed for the highest close in almost three months on speculation it is closer to selling a stake to Dubai-based Abraaj Capital Ltd.
Shares of Citadel surged 4.1 per cent to 6.33 Egyptian pounds, heading for the highest close since March 23, at 12:13pm in Cairo. That gave the company a market value of 2.19bn pounds ($705 million). The benchmark EGX 30 Index gained 0.7 per cent.
Abraaj, a Dubai-based private-equity firm, may hire Morgan Stanley as an adviser on the planned acquisition of a stake, two people familiar with the situation said. Citadel Capital Partners, the main shareholder in Citadel Capital, may hire Citigroup Inc. to advise on the possible sale, the two people said June 16, speaking on condition of anonymity because the talks are private. One person said Abraaj is seeking a controlling stake in Citadel.
“Investors expect Abraaj to pay a higher price for Citadel shares than they are currently trading at,” said Ramy El Agamy, manager of institutional sales at NBK Capital Securities Egypt in Cairo. “Citadel would benefit because Abraaj will provide liquidity to enable it to continue its expansion in the region after Egypt’s regulator refused its capital increase.”
Egypt’s markets regulator last month rejected Citadel’s application for a capital increase because the company didn’t provide enough detail on how it will use the funds. Citadel said it would appeal the decision.
Morgan Stanley officials weren’t immediately available to comment. Officials from Citigroup and Citadel Capital declined to comment. None of the officials would be identified, citing internal policy.
Your comments