Under the deal, Emirates will purchase BNP Paribas’ 95.2% stake in the company at a rate of 1.6 times the book value as at September this year. Emirates also plans to simultaneously offer to acquire the remaining 4.8% of BNP Paribas Egypt from its minority shareholders at the same price.
It is anticipated that the transaction will close by the end of the first quarter of 2013.
Emirates said the deal will “bring together BNP Paribas Egypt’s local expertise, customer base and knowledge of the Egyptian market with the regional strength and knowledge of Emirates NBD”.
In a statement, the bank added that it “aspires to expand its footprint in retail and corporate banking outside the UAE and has identified Egypt as a key strategic market for future growth”.
BNP Paribas Egypt, headquartered in Cairo, recorded revenues of EGP731m ($121m) and net earnings of EGP222m ($37m) in 2011. The bank has a network of 69 branches throughout the country, 1,450 employees, and approximately 200,000 retail and 3,000 corporate clients and its shareholders’ equity amounted to EGP 1.9bn ($312m) as of 30 September 2012.
Following completion of the transaction, Emirates NBD and BNP Paribas plan to co-operate in a number of business areas such as trade finance, cash management and corporate and investment banking. BNP Paribas will continue to service its clients in Egypt through this preferred partnership.
HH Sheikh Ahmed Bin Saeed Al Maktoum, chairman of Emirates NBD, said: “This deal represents an excellent opportunity for Emirates NBD to enter the promising Egyptian market and achieve our strategic aspiration of expanding regionally. It represents an important milestone in our regional growth and we are confident that it will bring successful results to all our stakeholders”.
