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EAEF Announces an Investment in Sarwa Capital

EGYPTIAN-AMERICAN ENTERPRISE FUND ANNOUNCES MAJOR INVESTMENT IN SARWA CAPITAL S.A.E.

The Egyptian-American Enterprise Fund (“EAEF”) today announced that it has entered into conditional binding agreements to invest in Sarwa Capital S.A.E. (“Sarwa Capital”), a pioneer in consumer finance, leasing and securitization in Egypt. The transaction includes the injection of US$20 million of new capital to enhance the company’s capital base, in addition to acquiring some existing stakes giving EAEF a majority stake in the business.

This announcement is an additional step in EAEF’s primary goal to promote financial inclusion, create employment opportunities, and attract new foreign investors to the Egyptian market. EAEF’s announcement demonstrates its strong commitment to support investment in the Egyptian private sector and the Egyptian economy.

“Our partnership with Sarwa Capital will help us support an already-established and successful management team in growing their business. We are honoured to have the opportunity to assist Sarwa Capital in further expanding its financing base and product offering in Egypt,” said James A. Harmon, Chairman of EAEF, adding: “Only about 10% of the Egyptian adult population currently hold a bank account, and approximately 50% of Sarwa Capital’s client-base comes from outside the banking system. Sarwa’s core competencies lie in its ability to structure and organize credit extension in innovative ways that has helped expand the consumer finance market, including serving the previously unbanked population, which in turn is expected to strengthen the average Egyptian’s purchasing power. Sarwa Capital’s consumer finance business, small and medium sized leasing business, as well as mortgage business are all areas with significant room for growth. In addition, we believe that Sarwa Capital’s position as the largest issuer of debt securitizations in Egypt will pave the way for further deepening of the debt capital markets in the country. EAEF intends to bring its vast resources and network of best-practice expertise to support the current management team in addressing these exciting businesses.”

“It is our great pleasure to welcome the Egyptian American Enterprise Fund on board and we look forward to a fruitful and long partnership. We have found in EAEF a long-term partner that shares our vision and commitment to creating value by leading the development of retail and structured finance in Egypt. EAEF’s resources will be invaluable to us as we seek to grow as the largest player in structured financial services, in addition to complementary activities that serve both the banking sector and the debt capital markets,” added Hazem Moussa, Managing Director and co-founder of Sarwa Capital.

Ibrachy & Partners acted as the legal counsel to EAEF. Arab Legal Consultants acted as legal counsel to the management team and other minority shareholders.

Closing of the transaction is subject to the satisfaction of customary closing conditions.