Qalaa Holdings (CCAP.CA on the Egyptian Exchange, formerly Citadel Capital), an African leader in infrastructure and industry, and Saudi Arabia’s Construction Products Holding Company (CPC), through its subsidiary CPC Emirates, announced that they have signed today a sale and purchase agreement for the sale to CPC of 100% of Sphinx Glass.
The size of the transaction will imply an enterprise value of around US$ 180 million (EGP 1,280 million), which translates into a cash consideration of US$ 114.2 million (EGP 815 million) for 100% of the shares after deducting debt and liabilities to be assumed by CPC.The transfer of cash and shares is expected to conclude in July.
Qalaa Holdings’ 73.3% stake in Sphinx Glass will result in cash proceeds of around US$ 73 million (EGP 521 million)to Qalaa Holdings after the estimated capital gains tax.
Sphinx Glassis a 200,000-ton-per-annum, state-of-the-art float glass production facility that began full operations in April 2010 and is today one of the largest independently operated float glass producers in the MENA region. In addition to being a key player in the Egyptian market, Sphinx Glass is also a significant regional and international exporter.
The company specializes in the production of clear and tinted float glass and online coated glass in varying thicknesses. The company recorded EGP 393 million (USD 54.95) in sales in 2013and is currently on target to exceed its budget for the second consecutive year.
“Sphinx Glass was an idea born on the eve of a global recession and commissioned mere months before the start of the 25 January 2011 Revolution,” said Qalaa Holdings Co-Founder and Managing Director Hisham El-Khazindar. “Despite these headwinds, we have worked closely with management and our co-investors to create over375 new jobs and catapult Sphinx Glass into the ranks of both key national players in Egypt and leading regional and global exporters.
“We wish CPC great success in capitalizing on Sphinx Glass’s potential,” he said.
“Sphinx Glass is one of the most technologically advanced plants in Egypt with a strong management team complementing CPC’s existing portfolio of building materials and is a perfect fit with our existing industrial presence in Egypt,” said CPC Chief Operating Officer Riad Kiwan.
“This acquisition is an important step in line with our group’s international expansion strategy, enabling us to capitalize on increasing demand for building materials and glass in Egypt and Africa, where the construction industry is booming with economic progress and increasing urbanization,” he added
Under CPCownership, Sphinx Glass will remain committed to supporting its valued customers in Egypt and in export markets, Kiwan concluded.
CPC is a leading construction products company providing “Complete Building Solutions” for all construction needs. Its product offering ranges from precast, glass & aluminum, steel, ready mix concrete, electric cables, wood & gypsum works, marble & granite, adhesive, construction equipment rental, finishing, steel structures, transportation, electromechanical, renewable energy, along with logistic support to serve the building industry all under one umbrella.
From proceeds of the transaction, Qalaa Holdings and its co-investors will distribute a significant one-time exit bonus to employees of Sphinx Glass, from line staff to senior management.
Qalaa Holdings was advised on the transaction by Arab Legal Consultants acting as the Seller’s Legal Counsel and PharosInvestment Banking SAE acting as the Sell Side Advisor.CPC was advised by Helmy, Hamza & Partners and Crédit Suisse.