Corporate news
Act Financial for Consulting [ACTF]
The Ordinary General Assembly approved granting a subordinated interest-bearing loan amounting to EGP 2 billion to its subsidiary Welzi Financial Holding, in which it holds a 90% stake. The loan will be used to increase the capital of Welzi Holding and/or to finance its subsidiaries.
In parallel, ACT is studying a capital increase for Welzi through a public offering and/or a private placement, with the size of the offering and any potential discount to fair value (if applicable) to be determined at a later stage. ACT has set the fair value of Welzi at EGP 10.83 per share.
The offered stake will be a minority stake, while ACT will retain a controlling interest of 51% or more. ACT is expected to announce the details of the capital increase within the coming weeks.
Welzi operates in brokerage, asset management, and wealth management, and serves as a Fintech-based wealth management platform. ACT aims to launch a fully integrated digital investment bank through the Welzi platform.
ACT’s share is currently trading at its 52-week low of EGP 2.69, with a trailing 12-month P/E multiple of 9x, compared to the sector average P/E of 11.16x, implying a fair value of EGP 3.34 per share.
Walaa Mosalam - Prime Research
WMosalam@egy.primegroup.org