America’s richest man, Bill Gates is part of a group of international investors acquiring a stake in OCI NV, an Egyptian construction and fertilizer company.
On Friday, OCI N.V, a wholly-owned subsidiary of Orascom Construction Industries SAE (OCI) controlled by Egyptian billionaire Nassef Sawiris, announced that it has raised $2 billion in commitments from international investors, including $1 billion from three U.S. groups: Cascade Investment, L.L.C – the private investment vehicle of Bill Gates; Southeastern Asset Management and Davis Selected Advisers.
OCI N.V has launched a share exchange offer which will see the company acquiring all of Orascom Construction Industries’ Regulation S Global depositary receipts (GDRs) in exchange for shares in OCI N.V. The deal also includes a mandatory tender offer whereby holders of OCI GDRs will have the option of either exchanging their shares with an identical amount of OCI NV shares or selling their shares to OCI NV at the price of 280 Egyptian pounds ($43) per OCI share in compliance with Egyptian regulations. The capital injection from Bill Gates’ holding company and other investors is primarily expected to provide OCI NV with the funds required to pay shareholders who elect to tender their OCI ordinary shares for cash.
The Sawiris family and Abraaj Capital, which together own 60 percent of Orascom, are also participating in the tender and have submitted all their OCI GDRs to exchange for OCI N.V shares.
This is arguably the first time Bill Gates’ Cascade Investments is investing a sizable amount in an African company. Analysts expect the deal to boost international investor confidence in Egypt’s main benchmark index.
Nassef Sawiris, the Chief Executive Officer (CEO) of OCI, commenting on the transaction said, “This transaction is proof of the existing international appetite to invest in Egypt and bodes well for the Egyptian economy with more than US$ 1 billion committed by US investors.”
Orascom Construction Industries, SAE is Egypt’s largest publicly traded company and has an approximate market value of over $9 billion.