French lender Societe Generale SA (EPA:GLE) said it had agreed to sell a 77.17% stake in its Egyptian subsidiary National Societe Generale Bank SAE (CAI:NSGB) for USD1.97bn (EUR1.5bn) to Qatar National Bank Group (DOH:QNBK) or QNB Group.
The parties started talks on the deal at the end of August after the vendor was approached by QNB. The target, with total assets of EGP63.3bn (USD10.3bn/EUR7.9bn) employs more than 4,150 people at some 160 branches across the country. The deal values the whole of it at USD2.56bn, or two times its book value as of 30 September 2012.
Should the buyer get regulatory clearance for the deal, it would start a mandatory tender offer for 100% of the share capital of NSGB in early 2013, it said in a separate statement adding that the acquisition matches its strategy to expand internationally. The French lender has committed to tender its shares into the offer. The price per share will be set on the basis of the USD/EGP conversion rate at the time of the filing of the mandatory offer.
The deal, to be funded with own resources, is seen to immediately boost the buyer’s earnings in 2013. On the other hand, Societe Generale expects to book a net gain on the sale of some EUR350m (USD457.4m).
Completion of the deal is due in the first half of 2013. QNB Capital LLC, JP Morgan Chase & Co (NYSE:JPM), Clifford Chance LLP and Zaki Hashem & Partners provided advice to QNB on the deal.