KEY THEMES
shares will be suspended effective today until the Listing Committee at the Egyptian Exchange (EGX) issues its decision with regards to OIH’s proposed spinoff. With the new company, initially to be known as Orascom Financial Holding (OFH) owning OIH’s stakes in Sarwa Capital Holding [SRWA] (29.24%) and Beltone Financial Holding [BTFH] (74.55%), we calculate that based on all three stocks’ closing prices yesterday, OIH’s remaining business is now worth some EGP981mn or EGP0.187/share (compared to a post-split EGP0.169/share or 26.2% of the pre-spinoff price), while OFH is now worth some EGP2.4bn or EGP0.460/share (compared to a post-spinoff EGP0.478/share). In other words, if both post-spinoff OIH and OFH were to trade today, the former would offer a 10% upside, and the latter a 4% downside. Once we know when the new shares will trade, we would simply need to compare the post-spinoff implied values to know which one should be bought/sold.
POSITIVE
CICH: In line with our Core Coverage dated 14 January 2021, CI Capital Holding [CICH] has taken a step closer to list Taaleem, owner of El-Nahda University in Upper Egypt, on the EGX. This, as well as Banque Misr’s intention to acquire up to 90% of CICH at EGP4.7/share, should offer some support for the stock, which we value at EGP5.2/share with a 12M PT of EGP6.0/share.