EFG-Hermes to launch Syrian PE fund

The MENA-based investment bank is setting up an office in Damascus and will raise a private equity fund focused on the country.

EFG-Hermes, an Egyptian investment bank with a private equity arm, is to set up a “full fledged” office in Damascus, the capital of Syria, and will simultaneously launch a private equity fund focused on investments in the country.

EFG-Hermes Syria is a 70:30 partnership between EFG-Hermes and Firas Tlass, a Syrian businessman. The venture will offer services including investment banking, brokerage, private equity and asset management services. It is awaiting final approval from the Syrian Commission on Financial Markets and Securities to launch its operations.

Tlass will be chairman of EFG-Hermes Syria. He is the founder of the Min Agl Suriyya Group, which has made numerous investments across projects in real estate development, transportation, cement and fertilizer sectors in Syria.

Hazem Badran, until now a manging director with investment banking division at EFG-Hermes, has been appointed chief executive officer for the new venture. 

The size of the private equity fund to be raised has not been disclosed.

“The recent reforms undertaken by the Syrian government to liberalise the economy and facilitate the business environment have made Syria a compelling investment opportunity,” Hassan Heikal, the chief executive officer of EFG-Hermes, said in a statement. 

The Syria fund will invest across various sectors, providing growth capital for established companies as well as making green field investments. EFG-Hermes will anchor the fund, committing 10 percent of the fund’s capital. 

Syria has a population of more than 20 million and its GDP has been growing steadily at a rate of 4.1 percent over the last three years, the firm said. Other factors that make Syria an attractive investment destination include an expectation of continued growth in consumer demand, favourable demographics whereby more than one-third of the population is under the age of 14, and the private sector’s need for significant amounts of capital. 

Thus far, EFG-Hermes Private Equity has raised about $1.2 billion across nine funds and the firm has invested in 34 companies across sectors such as oil and gas, food and agribusiness, construction and building materials, and real estate. 

EFG-Hermes was unavailable for comment at press time.