PARIS, France – Saudi Arabia has put a plan by its sovereign wealth fund to acquire the United Bank of Egypt on hold because of a disagreement with the Egyptian authorities over its valuation, two sources familiar with the matter told Reuters.
The pause is the most recent stumble in the vast investment programme promised by Gulf states after Russia’s invasion of Ukraine promote foreign investors to pull more than $20 billion out of Egyptian markets, throwing its economy into crisis.
Saudi Arabia, Abu Dhabi, and Qatar last year all promised to make a large investment to help Cairo shore up its finances.
Saudi Arabia deposited $5 billion with Egypt’s central bank in March, and in June said it intended to lead $30 billion worth of investments following a visit to Cairo by Crown Prince Mohammed bin Salman Al Saud.
Saudi Arabia’s Public Investment Fund (PIF) began talks last year with Egyptian authorities about buying United Bank.
The two parties could not come to an agreement over how to value the government – owned lender due to the evaluation of the pound, and both parties are holding their position, the sources said.
Egypt has allowed its currency to depreciate by almost 50% since the outbreak of the Ukraine crisis.
Egypt’s government announce in April it was seeking to attract investments of $10 billion in each of the coming four years, part of a programme to increase private participation in the economy.
The PIF – owned Saudi Egyptian Investment Co (SEIC) bought minority stakes in four Egyptian companies in August for $1.3 billion, but since then has not announced any substantial new investments.
The pause is the most recent stumble in the vast investment programme promised by Gulf states after Russia’s invasion of Ukraine p foreign investors to pull more than $20 billion out of Egyptian markets, throwing its economy into crisis.promoteslikewise been slow in finalizing any deals.
Leave a Reply