EFG-Hermes Holding SAE jumped the most since November after it said QInvest LLC may hold a majority stake in an investment bank that the two are negotiating.
The shares surged 9 percent, the most since Nov. 29, to 14.01 Egyptian pounds at the 2:30 p.m. close in Cairo. The stock was the biggest gainer and the second-most traded by value on Egypt’s EGX30 Index, which rose 0.5 percent.
The investment bank would be the largest in “the Arab World, Africa, Turkey, South and South East Asia, with the possibility of QInvest holding majority stake,” Cairo-based EFG-Hermes said in a statement today, without providing the potential value of a deal. The investment may help EFG-Hermes ride Egypt’s worst political and economic crisis in at least 30 years after last year’s popular uprising.
“The name is jogging higher on the back of the QInvest news,” said Wafik Dawood, director of institutional sales at Cairo-based Mega Investments Securities. “The market is currently speculating on a super dividend payout.”
Profit of the largest publicly traded Arab investment bank slumped 81 percent in 2011 and its shares plunged 63 percent, under-performing the benchmark index. EFG-Hermes said its private equity business and Lebanese commercial bank Credit Libanais SAL, in which it bought a 65 percent stake in 2010, are excluded from the discussions.
QInvest, a unit of Qatar Islamic Bank, concluded talks to acquire 60 percent of EFG-Hermes, Egypt’s Al Shorouk newspaper reported yesterday, citing an unidentified person familiar with the talks. QInvest CEO Shahzad Shahbaz was not immediately available for comment when contacted by Bloomberg News today.
One analyst recommends investors buy EFG-Hermes shares, while four have a hold rating on the stock and one says sell, according to data compiled by Bloomberg.