The Vice President of the Egyptian Financial Supervisory Authority, Dr. Islam Azzam, confirmed the issue of the regulation for the establishment and operation of companies with the purpose of private acquisition or SPAC, and the listing of their cards on the Stock Exchange Egyptian for the first time as a new funding mechanism, revealing the readiness of at least two companies for such a step, but has not yet been approved.
Azzam added in an interview with Al-Arabiya that the Financial Supervisory Authority has issued another decision that includes an amendment to the rules for listing and delisting securities on the Egyptian Stock Exchange to facilitate the listing of SPAC shares, also known as Check company in white in the local market.
He explained that at the beginning of the offer, the company deals with the company venture capital with a minimum capital of 10 million pounds, then begins to raise the capital through a private or public offering, then the proceeds of the increase are placed in a fund that invests in low-risk instruments, and a two-year period is given to find an acquisition opportunity If the two-year period has elapsed without going through the acquisition process.
He stated that following these procedures, a general meeting was held to approve the acquisition of the target company and, after approval, the minority stake that refused the acquisition is entitled, within 30 days, to recover their money by selling the shares in stock exchange or through treasury shares or through additional investors, indicating that the acquisition is via a merger, then the security is traded in bag as usual.
He pointed out that there are clear conditions, announced in the prospectus, which include data on additional incentives for institutional investors, a presentation of their experiences, a presentation of conflicts of interest controls, money recovery controls and details on investments with risk instruments through clear explanations in the prospectus.
He identified three elements in to which exceptions can be made for this type of company that is formed for a special purpose, namely, a budget request for the last two years, a requirement for a net profit of not less than 5% of the capital, and mandatory that the principal founders own 51% and hold it for two years, explaining that emerging companies With new ideas, they can enjoy such exceptions from three conditions to the Egyptian Stock Exchange listing rules.
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