Summary sheet
This operation seeks to support private sector development in Egypt and is expected to foster trade between the EU and Egypt, in sectors supporting EU's Global Gateway priorities.
The key project objectives include supporting the development of the private sector in Egypt, by increasing access to patient risk capital for - and providing managerial value-add to - local small and medium enterprises (SMEs). This is expected to support the growth and institutionalisation of Egyptian private companies that are mostly family owned in the target segment. The fund will build on the strategy adopted in an inaugural fund. The fund manager will aim to create value through a hands-on approach, driving the growth and profitability of investee companies as well as enhancing environmental, social and governance (ESG) standards and implementing appropriate digitalisation measures.
Through this operation, the EIB will support the growth and institutionalisation of an independent local Egyptian fund manager, that provides much needed equity risk capital and managerial value-add to local enterprises that operate across various economic sectors. This is expected to enhance the sustainability and contribute to the development of local companies, that enhance local employment for a growing urban population.
By providing growth capital and managerial advice to local companies, the operation is anticipated to contribute to boosting enterprise capabilities and competitiveness through access to finance and improved skills.
The EIB's commitment is anticipated to support the fund reach its target size in a difficult fundraising environment, amid geopolitical and macroeconomic uncertainty. The EIB is expecting to provide guidance to the fund manager on best market practices, and thus, contribute to its institutionalisation.
The proposed operation is consistent with EU policy as articulated in the new Agenda for the Mediterranean. Specifically, Flagship 5 "Connected economies", which foresees the financing of Micro, Small and Medium Enterprise (MSME).
The Fund's focus on SMEs and family-owned businesses reflects both a structural market opportunity and a deliberate strategy to serve as the partner of choice for companies seeking to professionalize, and scale. Through this approach, the Fund aims to generate attractive returns to investors and to broaden the development of Egypt's SMEs ecosystem, reinforcing the Fund's role as a catalyst for long-term growth and value creation.
The fund will operate in line with the EIB's Environmental and Social standards.
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