Mona Zulficar, EFG-Hermes Board of Directors chairperson, has asserted that signing the joint venture deal with QInvest has no causal connection to Al Watany Bank of Egypt (AWB) case in which two Hermes CEOs face charges. “The main reason behind signing this deal with QInvest is the decline in the profits of Securities Brokerage and Asset Management due to the current circumstances." Zulficar added “The deal has been signed on the purpose of ensuring shareholders' interests." In the meanwhile, Zulficar noted that upon Egyptian Financial Supervisory Authority (EFSA)'s request, EFG-Hermes will be reconvening its shareholders' annual meeting within a week or a maximum of 10 days. “During this meeting, we will provide some additional more detailed disclosures on the QInvest deal and the fate of the minority's rights after signing the deal ... we don't have something to hide behind the scenes." Referring to any alternative offers Zulficar said: “Planet IB's buyout deal to seize 100% of EFG-Hermes stakes was not serious, it has come quite late as EFG-Hermes group had already signed the strategic alliance with QInvest besides Planet did not file any tender offer applications with EFSA." On QInvest deal, Zulficar added that EFG-Hermes (HRHO.CA)'s strategic partnership with Qatar's QInvest shall be by the forms of transferring Hermes' stakes in sectors of brokerage, research, asset management, investment bank services and infrastructure investment to EFG-Hermes Qatar for $250 million pursuant to the agreement – Item (1). She added that 60% of EFG-Hermes' stakes in Seed Capital of the asset management business at market value shall be transferred to EFG-Hermes Qatar, pursuant to the agreement – Item (2). “QInvest will have the right to acquire from EFG Hermes its entire 40% shareholding at any time after two years from signing of the transaction." QInvest deal is of $320 million through raising Hermes Qatar's capital, About $60-70 million shall be paid when the deal comes into effect. If Hermes is willing to sell its entire 40% shareholding after two years from signing the deal, QInvest shall pay around $165 million.
