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EFG Hermes Successfully Advises Pioneers Properties for Urban Development on EGP 627.5 Million Securitized Bond Offering

EFG Hermes’ investment banking division, the leading investment banking franchise in Frontier Emerging Markets (FEM), announced today the close of the first bond issuance, worth EGP 627.5 million, for Pioneers Properties for Urban Development’s affiliates EGP 3.0 billion securitization program. The bond is backed by a receivables portfolio of some EGP 798.3 million, representing 850 sales contracts from Pioneers Properties for Urban Development’s affiliates.
The bond is comprised of three tranches, with the first divided into fixed installments, and the second and third subsequently disbursed contingent on the proceeds of the portfolio. Tranche A is valued at EGP 229.0 million, with a tenor of 13 months, a credit rating of AA+ from Middle East Ratings and Investor Services (MERIS), and a fixed coupon rate of 9.60%. Tranche B is valued at EGP 257.3 million, with a tenor of 3 years, a credit rating of AA from MERIS, and a fixed coupon rate of 9.95%. Tranche C is valued at EGP 141.2 million, with a tenor of 6 years, a credit rating of A from MERIS, and a fixed coupon rate of 10.25%.
Commenting on the transaction Mostafa Gad, Co-Head of Investment Banking at EFG Hermes, said: “We are pleased to be expanding our footprint in the Egyptian Debt Capital Market (DCM) space, providing clients with a diverse range of funding instruments tailored to their needs and giving investors access to value-accretive investment options. The issuance of Pioneers Properties for Urban Development’s first securitized bond highlights our efforts to expand the range of industries we serve, driving value for our clients and investors alike.”
Waleed Zaki, Chairman and CEO of Pioneers Properties for Urban Development, commented: “We are delighted to be partnering with EFG Hermes on this transaction, owing to its alignment with our vision to grow the size of our operations nationwide, allowing us to further create value for our stakeholders. The agreement positions us well to capitalize on growing optimism in the real estate space while providing us with the opportunity to expand our business operations through robust partnerships. We always seek to diversify our funding sources to support the operations and future expansion plans while maintaining the strength of our balance sheet and overall financial position.”
This deal comes on the heels of EFG Hermes’ back-to-back advisory on the conclusion of Six of October Development and Investment Co. (SODIC) first EGP 343 million securitized bond offering in July of this year, as well as Premium International for Credit Services’ fifth EGP 211 million securitization issuance in the same month of the year. The Firm also completed advisory on valU, the leading Buy Now Pay Later (BNPL) Fintech platform’s first securitized bond offering worth EGP 322.5 million in September 2021.  

EFG Hermes acted as the sole financial advisor, sole transaction manager and book runner, underwriter, and sole arranger on the issuancedate on which they are made.