Private Equity News & Analysis

EFG-Hermes unit more than triples fund size

The Egyptian bank’s private equity arm has scaled up its fund size after making an internal rate of return of more than 70 percent over two years on realised investments from its previous fund.

By
Toby Lewis
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The Egyptian bank’s private equity arm has scaled up its fund size after making an internal rate of return of more than 70 percent over two years on realised investments from its previous fund.

The private equity unit of Egyptian bank EFG-Hermes has more than tripled its previous private equity fundraising effort, closing a $555 million (€365 million) third fund to invest in Egypt and North Africa, according to a statement.

The firm’s previous fund raised $155 million and its first fund closed on $54 million in 2000. Egyptian and regional financial institutions as well as high-net worth individuals invested in the latest fund.

Samer Yassa, a partner at EFG-Hermes Private Equity, said in a statement the previous fund had returned more than 80 percent of its principal investment to investors in two years at a realised internal rate of return of more than 70 percent.

EFG-Hermes has been growing rapidly. Middle Eastern private equity firm Abraaj Capital sold its 24.62 percent stake in the bank for double its initial investment after just one year through a $1.1 billion sale to local rival Dubai Financial Group.

The Egyptian market was the source of one of Africa’s largest-ever buyouts last year when Abraaj led a consortium to buy Egyptian Fertilizers Company for $1.41 billion in June.