June 06, 2012
By Farah Halime
CAIRO (Zawya Dow Jones)–Just days after Egypt’s EFG Hermes received full shareholder support for its planned alliance with Qatar’s QInvest , the Planet IB consortium that is attempting a hostile takeover of the bank said shareholders should force the board to either allow the group of investors to conduct due diligence or resign.
“EFG shareholders should view our offer as superior and force the board to allow us in or resign,” Planet’s Chief Executive Ahmed Housseiny said in an emailed statement to Zawya Dow Jones.
Housseiny added that the consortium, backed by Egyptian business tycoon Naguib Sawiris and United Arab Emirates’ Sheikh Tariq bin Faisal Al-Qassimi, is currently in talks with EFG Hermes shareholders to obtain approval and undertake due diligence.
“We are absolutely in dialogue with EFG Hermes shareholders and, indeed, held a call with a number of them as recently as this afternoon [Monday, June 4],” Housseiny said in his emailed statement. He didn’t identify any of the shareholders approached.
EFG Hermes said on Sunday that its shareholders–including the Abu Dhabi Investment Authorityand the Dubai Financial Group –had overwhelmingly voted in favour of the alliance with QInvest and dismissed Planet’s offer as “lacking any legal commitment nor guarantee to the bank or to its shareholders to conclude such a tender offer.”
Abu Dhabi Investment Authority declined to comment. Dubai Financial Group wasn’t immediately available for comment.
Housseiny said discussions with shareholders centred around Planet’s vision for EFG, including a focus on debt capital market products and expansion to “virgin frontier markets”.
The firm is due to meet the Egyptian regulator Tuesday regarding an appeal it submitted, claiming it hasn’t had an opportunity to conduct due diligence in order to place a tender, Housseiny said.
“We would file the tender offer once we complete due diligence. Under Egyptian capital markets law there is no mechanism to launch a public tender offer which is subject to due diligence,” he added.
Hours after EFG Hermes said Monday it would take legal steps to protect its shareholders from a hostile takeover attempt by Planet IB, the consortium responded with a pledge to match all guarantees and legal obligations provided by QInvest .
“Planet IB intends match the financial and legal guarantees and undertakings made by its competitor so that Planet IB may undertake due diligence… immediately,” the statement from the Arab investors said.
Planet’s statement Monday called on shareholders to allow it “an immediate opportunity to submit its offer, which it believes safeguards shareholder interests” by also postponing the conclusion of theQInvest deal.
“To do so, Planet IB requires approval to carry out the necessary due diligence within the legal timeframe,” the statement said. “Planet IB further requires that EFG Hermes Holding postpone conclusion of the sale of the firm’s core assets under what the company has called a ‘strategic alliance’.”