EFG Hermes has announced the successful close of an EGP425 million ($22.4 million) securitized bond issuance for real estate powerhouse Pioneers Properties for Urban Development and its affiliates – the second in an EGP3 billion program.
The bond is backed by a receivables portfolio of some EGP613.5 million, assigned to EFG Hermes Holding’s Financial Group for Securitization as the issuance’s Special Purpose Vehicle (SPV).
The bond is comprised of four tranches, with the first and second tranches divided into fixed instalments, and the third and fourth subsequently disbursed contingent on the proceeds of the portfolio.
• Tranche A – valued at EGP57.4 million, with a tenor of 13 months, and a credit rating of AA+ from Middle East Ratings and Investor Services (MERIS)
• Tranche B – valued at EGP42.5 million, with a tenor of 13 months, and a credit rating of AA+ from MERIS
• Tranche C – valued at EGP144.5 million, with a tenor of 36 months, and a credit rating of AA from MERIS
• Tranche D – valued at EGP180.6 million, with a 72-month tenor, and a credit rating of A from MERIS
Maie Hamdy, MD, Debt Capital Markets (DCM) at EFG Hermes’ investment banking division, said: “We could not be prouder of the remarkable headway we are making in the DCM space as we continue to bring to market lucrative investment prospects that serve the needs of our clients and create value for our partners. The second issuance of Pioneers Properties for Urban Development, which comes as part of the EGP3 billion program, has garnered significant traction from investors.
“This issuance comes on the heels of the first bond issuance worth EGP651.2 million for Bedaya Mortgage Finance, Egypt’s leading provider of online mortgage financing solutions, and a key pillar of our Non-Bank Financial Institutions (NBFI) platform. At EFG Hermes, we are dedicated to leading on the most innovative and nascent products that are not only tailored to the market’s needs, but also unlock the strongest growth prospects for the Firm.”
Waleed Zaki, Chairman and CEO of Pioneers Properties for Urban Development, said: “After a very successful first issuance, we are pleased to be partnering with EFG Hermes Holding once again. The second issuance for Pioneers Properties for Urban Development’s affiliates comes as an integral step in our strategy to continue expanding our operational footprint and client base, as we look for diversified funding solutions that bolster our capacities and enable us to capture a larger share of the rising demand in the Egyptian real estate landscape.”
EFG Hermes acted as the sole financial advisor, sole transaction manager and book-runner, underwriter, and arranger on the issuance. National Bank of Egypt (NBE), alongside Banque du Caire (BDC) and Commercial International Bank (CIB), acted as underwriters, with CIB also acting as the custodian bank. The legal advisor for the issuance was Baker & McKenzie and the auditor was KPMG.
This issuance comes on the heels of the Firm’s successful conclusion of the bond issuance for EFG Hermes Corp-Solutions, valued at EGP500 million, and Bedaya Mortgage Finance’s first securitization issuance worth EGP651.2 million, in June 2022. The transaction also follows the Firm’s successful advisory on Premium International for Credit Services’ sixth issuance, valued at EGP170 million, in addition to the first issuance of EGP300 million in Madinet Nasr Housing and Development’s (MNHD)’s securitization program, in January 2022.
