CI Capital Facilitates EGP 1.2985 Billion Securitized Bond Issuance for Al-Tameer Leasing
Table of Contents
CI Capital,a leading financial services group in Egypt,has successfully completed a securitized bond issuance totaling EGP 1.2985 billion (approximately $41.6 million USD as of November 21, 2023) for El Taamir Securitization. https://www.ci-capital.com/en/news/ci-capital-successfully-closes-egp-1-2985-billion-securitized-bond-issuance-for-el-taamir-securitization/ Al-Tameer Leasing adn Factoring Company (Al Oula) originated and assigned the underlying portfolio for this issuance. This deal highlights growing investor confidence in the Egyptian financial market and the leasing sector.
Issuance Details & Tranche Breakdown
The bond issuance was structured into three distinct tranches, each with varying tenors and credit ratings assigned by Middle east Ratings and Investor Services (MERIS):
Tranche 1: EGP 573.5 million with a 25-month tenor, rated AA+ by MERIS.
Tranche 2: EGP 462 million with a 37-month tenor,rated AA-.
* Tranche 3: EGP 263 million with a 48-month tenor, rated A.
These varying tenors and ratings allow for a broader range of investor participation, catering to different risk appetites and investment horizons.Securitization allows companies like Al Oula to unlock capital tied up in their asset portfolios, providing liquidity for further expansion.
Al Oula’s Growth and Performance
Haitham Serag, CEO of Al-Tameer Leasing and factoring, stated that the triumphant completion of this second securitization demonstrates strong investor confidence in the company’s financial health and future growth prospects. https://www.ci-capital.com/en/news/ci-capital-successfully-closes-egp-1-2985-billion-securitized-bond-issuance-for-el-taamir-securitization/
As of the issuance, Al Oula’s portfolio reached approximately EGP 7 billion (approximately $224 million USD). The company aims to increase this to EGP 8.5 billion (approximately $272 million USD) by the end of the year. During the first half of 2024, Al Oula secured contracts valued at EGP 5.1 billion (approximately $163 million USD), with 55% of this volume concentrated in the real estate sector. The company is also actively pursuing growth through joint financing agreements totaling EGP 850 million (approximately $27.2 million USD) and has increased its capital base to EGP 712 million (approximately $22.8 million USD) to support its expansion plans.
Understanding Securitization
Securitization is a financial practice where assets are pooled together and converted into marketable securities. In this case, Al Oula’s leasing and factoring receivables (the money owed to them by their clients) were the underlying assets. These receivables were then used to back the issuance of the bonds. This process allows Al Oula to raise capital without directly borrowing money, and it provides investors with access to a diversified stream of income.
CI Capital’s Role and Market Demand
Amr Helal,CEO of the Investment Bank (Sell-Side) at CI Capital,emphasized that this deal represents another significant step in broadening access to diverse financing solutions within the Egyptian market. Mohamed Abbas, Head of Debt Capital Markets at CI Capital, highlighted that the issuance was oversubscribed by nearly 200%, indicating substantial investor interest and confidence in Al Oula’s performance. [https://www.ci-capital.com/en/news/ci-capital-successfully-closes-egp-1-2985-billion-securitized-bond-issuance-for-el-taamir-securitization/](https://www.ci-capital.com/en/news/ci-capital-successfully-closes-egp-1-2985-billion-securitized-bond-issuance-for-el-taamir-securitization