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Egypt’s M&A Market Sees 21% Recovery in H1 2024

Egypt’s M&A Market Sees 21% Recovery in H1 2024

– M&A deals in Egypt rose by 21% year-on-year in H1 2024, reversing the downturn seen in 2023, when economic challenges, including currency devaluation and high inflation, caused a significant slowdown in activity, according to PwC’s report.

– A $35 billion investment from the UAE and support from international organizations like the IMF and World Bank helped stabilize the economy, reducing inflation and creating favorable conditions for increased M&A activity in 2024, PwC highlighted.

– Significant transactions in 2024 included ICON’s $800 million acquisition of a 51% stake in seven state-owned hotels and B-Investments Holding’s acquisition of a majority stake in Orascom Financial Holding, showcasing renewed investor confidence in Egypt.

Egypt’s M&A activity experienced a significant recovery in the first half of 2024, showing a 21% year-on-year increase, according to PwC’s recent report.

This is a notable shift from the sharp decline witnessed in 2023, when M&A deals were impacted by currency instability and economic pressures, including the depreciation of the Egyptian pound and inflation, which peaked at 38% in September 2023.

As highlighted in the latest PwC Middle East Economy Watch, the uptick in 2024 M&A deals has been largely driven by a $35 billion investment from the UAE, which played a critical role in implementing key economic reforms, particularly related to currency stabilization, and helped reduce inflationary pressures.

Additionally, financial support from international organizations like the IMF, World Bank, and EU further alleviated external financing risks, improving investor confidence in the Egyptian market.

According to the TransAct H1 2024 report, M&A activity in the Middle East saw 214 deals during the first half of 2024, marking a 4% decline compared to H1 2023. This regional dip contrasts sharply with the global trend, which experienced a significantly larger drop of 25%.

In Egypt, M&A activity saw a boost, with 46 deals completed in the first half of 2024 compared to 38 in the same period in 2023. The largest of these was the $800 million acquisition of a 51% stake in seven state-owned hotels by ICON, making it one of the largest M&A deals in the region.

Other notable deals include B-Investments Holding’s acquisition of a majority stake in Orascom Financial Holding and Yodawy’s acquisition by Ezdehar Mid-Cap Fund II.

PwC highlighted that the Egyptian economy has begun to show resilience despite ongoing challenges, positioning the country as a favorable M&A market.

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