Founder of Raya Holding for Financial Investments, Medhat Khalil, is in talks with several banks to obtain EGP 700-800m to finance his bid to take Raya private, he said during a press conference on Thursday.
Khalil previously said he would need EGP 500m to acquire a 58% stake of Raya. Early November, he said he was considering bringing a group of investors for his take-private bid.
The Financial Regulatory Authority (FRA) had ordered that Khalil launch a mandatory tender offer (MTO) or sell off shares in Raya after declaring he triggered the MTO requirement with an effective stake of more than 33%. Khalil said he and his family members control 32% of Raya shares, but the FRA is counting the 10% stake owned separately by his brother-in-law as a related party, bringing the Khalil group’s total stake to 42%.
Khalil appealed the set date and price by the FRA for the MTO, he said earlier this month.
He is also considering forming an alliance with investors to secure the required liquidity to acquire 58% of the firm’s shares, which are valued at EGP 500m, adding that he plans to initiate discussions with investment banks, such as EFG-Hermes, to find the best way to resolve the problem.
“Having studied the current situation accurately, I found that submitting the MTO to buy the remaining 58% stake would require a high level of liquidity that cannot be secured within the period set by the FRA,” Khalil stated.
It comes as Raya Holding reported a net profit of EGP 41.53m in the third quarter of 2018, up 28.6% from EGP 32.28m in the same period last year. Revenues were up 25.8% year-over-year to EGP 2.19bn from EGP 1.74bn.