African Capital Markets News » Algeria

SANAD Fund to target SMEs in North Africa and Middle East

Tom Minney — Thu, 25 Aug 2011 14:39:21 +0000

Tiny, small and medium businesses in Egypt and Tunisia, later Algeria and Morocco, are set to benefit from a new €30 million ($43.2 mn) SANAD Fund for MSME (www.sanad.lu). This was set up in August 2011 by German development bank KfW Entwicklungsbank with funding from the German Ministry for Economic Cooperation and Development and the European Commission and will offer debt and equity financing to partner institutions in the Middle East and North Africa (MENA) region that serve micro, small and medium enterprises (MSMEs). Other target countries include Middle Eastern countries such as Lebanon and Jordan.
The fund is expected to attract further investments from public and private bodies. The partners who will help invest the money will be banks, microfinance institutions, financial service providers, leasing and factoring companies, guarantee funds or venture capital funds. The fund will also offer them technical help to build their skills and reach.
Development finance alternative asset manager Finance in Motion GmbH (www.finance-in-motion.com) and Oppenheim Asset Management Services S.à r.l. (www.oppenheim.lu) will manage the new fund which will be structured as a Luxembourg-based Specialized Investment Fund, SICAV-SIF, involving different share classes.
By facilitating access to finance in the region, SANAD – literally “support” in Arabic – aims to strengthen the MSME sector and local financial markets in the MENA region in line with the principles of responsible finance.

Algiers Stock Exchange: Results of Alliance Assurances IPO offer

Tom Minney — Mon, 10 Jan 2011 10:09:10 +0000

Results have recently been released of the share offer of insurance company Alliance Assurances (www.allianceassurances.com) on the Algiers Stock Exchange (www.sgbv.dz). The share offer was open from 2 November until 1 December and was oversubscribed, with private individuals flocking to receive the shares. Alliance aims to be the first private company to list on the Bourse d’Alger. It was one of the last IPOs or public offerings of shares on the African stock exchanges in 2010.
According to the official announcement from the Bourse d’Alger total of 1,804,511 shares were subscribed, the full amount offered, at a price of 830 Algerian dinars (USD11.17) each.

IPO Offer allocation
The offer was allocated as follows:
Section A: 33.3% (600,000 shares) for individuals with Algerian nationality: received 1,338,346 shares of 74.17% of the total. There were a total of 5,374 applications of which 5,284 each applied for less than 3,591 each and were allocated in full, while the remaining 90 applicants got 3,591 or 3,592 shares each.
Section B: 28.5% (514,286 shares) for institutional investors: received 181,625 shares or 10.07%. There were 4 applicants of which 3 each applied for less than 60,240 and were allocated in full and one applied for more and received 60,240 shares.
Section C: 28.5% (514,285 shares) for Algerian companies: received 186,022 shares or 10.31%, all who applied were allocated.
Section C2: Subscription Right, allocated 90,226 shares, received 100% of the allocation, all who applied were allocated.
Section D: 2.37% (42,857 shares) for insurance brokers and were allocated 3,635 shares (0.2%), all who applied were allocated.
Section E: 2.37% (42,857 shares) for the company’s employees across the 35 Algerian provinces, of which 4,657 shares were subscribed, 0.26%, all who applied were allocated.
The financial adviser for the offering is Nomad Capital (www.nomadcapital.com – website still says “under construction”), with PriceWaterhouseCoopers and Hadj Ali.
According to a previous report, General Manager Hacen Khelifati said that the company would also sell 30% to an unnamed European company in a separate transaction, which awaits regulators’ approval. He was also reported as saying that the company would benefit from government incentives to encourage listing including a 5-year tax holiday on profits from the operation in order to raise new capital for development and to help revitalise the Algiers Bourse.
Alliance plans to use the capital to meet new regulatory requirements and to set up 2 new subsidiaries:
• A real estate asset manager to maximize value for Alliance and third-party investors;
• A venture capital vehicle dedicated to investments in sectors related to the insurance field.
Alliance Assurances already has two subsidiaries: ATA, and a dedicated IT engineering subsidiary named ORAFINA.
Alliance Insurances is a joint-stock company created in July 2005 and says it is now a multiline insurance company with more than 300,000 insured clients and total net premiums in 2009 of 2.8 billion Algerian Dinars with a net profit of 312 million Algerian Dinars, providing a 39% return on equity, according to a press release.

About the Bourse d’Alger
The Société de la Gestion de la Bourse des Valeurs Mobilières was set up in 1997 under a 1993 law and started trading in 1999. The bourse website says the listed equities are Egh el Aurassi (state-owned hotel) and Saidal (state-owned pharmaceutical company) while the listed debt securities are Algerie Telecom, Spa DAHLI and Sonelgaz securities. Trading takes place twice a week, on Monday and Wednesday mornings for two hours.

Alliance Assurances to be first private listing on Algiers Bourse

Tom Minney — Sun, 17 Oct 2010 20:51:56 +0000

Insurance company Alliance Assurances (www.allianceassurances.com) plans an initial public offering on the Algiers Stock Exchange (www.sgbv.dz) from 2 November for one month. It will be the first private company to list on the Bourse d’Alger.
Approval was given by the Algerian Capital Markets Authority (Commission of Organization and Surveillance of Stock-market transactions – www.cosob.org) on 8 August. The financial adviser for the offering is Nomad Capital (www.nomadcapital.com – website says “under construction”), with PriceWaterhouseCoopers and Hadj Ali.
The share price is 830 Algerian Dinars (US$11.22) and the company plans to issue 1.8 million shares. The company had increased its paid-up capital to 800 million Algerian Dinars ($10.8 million) in 2009, and with the current offering it aims to increase to 2.2 billion Algerian Dinars ($29.7 million).
According to local reports, General Manager Hacen Khelifati has indicated that the company’s shares are in 5 categories: 20% for individuals with Algerian nationality, 30% for Algerian companies, 30% for institutions – including foreign investors “abiding to the Algerian legislation”, 10% for insurance brokers and 10 % for the company’s employees across the 35 Algerian provinces.
He told Reuters that the company would also sell 30% to a European company in a separate transaction. He did not name the suitor and said the transaction awaits regulatory approval
Khelifati was also reported as saying that the company would also benefit from government incentives to encourage listing including a 5-year tax holiday on profits from the operation in order to raise new capital for development and to help revitalise the Algiers Bourse. He was quoted on Reuters as saying 4 more companies would list before the end of 2011.
The aim of the capital expansion is to meet the regulatory requirements of an executive decree (N 09-375 of 16 November 2009) and to be able to capitalize on the expected strong growth in the insurance sector. According to website www.lesafriques.com, the insurance sector had turnover of €790 million in 2008 and is growing by 13% a year. It is dominated by state-woend firms (70%) and Alliance is the second private company, with a 4% market share.
Alliance also plans to use the capital to set up 2 new subsidiaries:
• A real estate asset manager to maximize value for Alliance and third-party investors;
• A venture capital vehicle dedicated to investments in sectors related to the insurance field.
Alliance Assurances already has two subsidiaries: ATA, and a dedicated IT engineering subsidiary named ORAFINA.
Purchase orders will be underwritten by a banking syndicate which is led by Crédit Populaire d’Algérie and includes Banque Nationale d’Algérie, Banque Extérieure d’Algérie, Banque de Développement Local, Caisse Nationale d’Epargne et de Prévoyance-Banque, Banque de l’Agriculture et du Développement Rural, la Société Générale Algérie and BNP Paribas Algérie.
This operation is backed by an advertising campaign (press, TV, radio, posting, Web, event) to give people the right information and encourage them to subscribe. The motto is ” Become shareholders and let’s grow together”
After the subscription period, Alliance Assurances aims to have its shares listed for trading on the Bourse d’Alger during the first quarter of 2011. The CPA will provide the liquidity to the stock over a 1-year period.
According to the regulatory requirements, Alliance Assurances will communicate regularly its financial results and any critical data relative to its activity and its development.
Alliance Insurances is a joint-stock company created in July 2005 and says it is now a multiline insurance company with more than 300,000 insured clients and total net premiums in 2009 of 2.8 billion Algerian Dinars with a net profit of 312 million Algerian Dinars, providing a 39% return on equity, according to a press release.

About the Bourse d’Alger

Tom Minney — Sun, 17 Oct 2010 20:39:03 +0000

The Bourse d’Alger (Société de la Gestion de la Bourse des Valeurs Mobilières – www.sgbv.dz) was set up in 1997 under a 1993 law and started trading in 1999. According to Les Afriques: “At the moment there are only 2 listed companies in Algeria: state pharmaceutical company Saidal and the El Aurassi hotel. Trading takes place twice a week, on Monday and Wednesday mornings for two hours. Average volume so far in 2010 was €80 000 and the float is €15m.”
The bourse website says the listed equities are Egh el Aurassi and Saidal while the listed debt obligations are Air Algerie, Algerie Telecom, Spa DAHLI and Sonelgaz securities. It says there were a total of 488 trades in 2009 (worth $6.7 million) and 293 to date in 2010.
Reuters reports that Khelifati said he had received assurances from Algerian officials that a programme of reform was underway to encourage the development of the exchange. This will include a new law to give exemption from tax for all capital gains on stock-market operations for 5 years. The agency comments; “An opening up of the stock exchange would go against the trend in Algeria, where investors and analysts say the government has been creating new obstacles for some private businesses and especially foreigners.”

Emerging Capital Partners targets North Africa construction

Tom Minney — Thu, 30 Jul 2009 16:46:24 +0000

Emerging Capital Partners (ECP) announced on 27 July it has bought controlling stakes in Shoresal and Almes – both North African construction companies – for a total USD $26.2 million. ECP (www.ecpinvestments.com) is an international private equity firm focused on investing across the African continent with a nine-year track record and the first to raise more than $1.6 billion to invest in companies across Africa.

It is expanding its North African investments.

Thomas Gibian, chief executive officer of ECP, says: ”ECP has invested in various African engineering and construction companies since 2006, and we have long been evaluating opportunities in the North African market…Unlike many western markets, North African real estate and construction is generally driven by a lack of supply to meet the increasing demand from both foreign and domestic companies.”

In Algeria, ECP acquired a $13.8 million stake in Shoresal, a real estate development company, which will use ECP’s investment, in part, to finance the development of a 14-storey Class A office tower in the Bab Ezzouar business district of Algiers. According to the company’s research, demand for office space in Algeria’s major cities is approximately eight times greater than the current supply, driven by a tripling in the number of multinational companies since 2000.

The investment was made through ECP’s MENA Growth Fund LLC, which was established in September 2007 to capitalize on investment opportunities throughout the Middle East and North Africa.

In Morocco, ECP invested $12.4 million in Almes, the holding company of Entreprise Marocaine de Travaux (EMT) and Somadiaz. EMT specializes in public works infrastructure projects such as dams, levees and airports. Somadiaz is an equipment leasing company that provides specialized equipment to commercial and industrial clients. The companies will expand in Morocco and into neighbouring countries – such as Libya and Mauritania – where demand for public works and other construction services are also high. ECP’s investment is in partnership with Alliances Développement Immobilier, a leading integrated real estate and tourism group in Morocco.

The investment in Almes was made through the Moroccan Infrastructure Fund, a joint venture between ECP and Attijariwafa bank, which was established in December 2006 to capitalize on the ongoing reforms that are spurring economic growth in Morocco. It targets numerous sectors including telecoms, transportation, energy, power and water.

“ECP views the construction markets across North Africa as uniquely poised for growth,” said Vincent Le Guennou, executive vice president of ECP. ”We believe the strong supply and demand imbalance in the sector is a compelling reason to invest.”