Egypt M&A posts impressive rebound in 2021

Interest in high-growth industries such as TMT and financial services resulted in a string of deals—from both local and international bidders.

Egyptian dealmaking delivered a strong performance in 2021. A total of US$6.7 billion changed hands—the highest annual deal value in nine years.

With 22 deals recorded, annual volume increased by 38% year-on-year, signifying a returning confidence in the market following a challenging 2020.

Mobile payment demand fuels deals

The technology, media, and telecom (TMT) sector housed the highest valued deal of the year: Vodafone’s sale of a 33% stake in its Egyptian arm to Vodacom Group, South Africa's largest mobile operator by subscribers. Valued at US$1.6 billion, the deal will see Vodacom expand its mobile money offerings, including its Vodapay and M-Pesa platforms, into Egypt, which offers investment potential due to its young and largely unbanked population. The deal is expected to result in double-digit revenue growth for Vodacom.

Egypt’s mobile payments industry is growing fast—it is estimated to record an annual growth rate of 19.3% to reach US$22 million by 2025. In response to rising demand, the Egyptian government has taken steps to promote investment in the country’s fintech space. The latest step is Egypt central bank’s issue of licenses enabling contactless mobile phone payments, announced in September 2021.

And in July 2020, Egypt’s government introduced a data protection law promoting online banking. Such regulatory changes aim to transform Egypt’s fintech industry into a regional center for international investment.

Financial services attracts lion share of deals

While the TMT sector attracted the highest valued deal of the year, it was the financial services sector that proved the driving force behind Egypt’s dealmaking activity. Four out of the top ten deals of the year took place within the sector.

The largest of these changed hands between two Egyptian firms: Banque Misr’s US$767 million acquisition of a 90% stake in CI Capital Holding. Through its purchase of the diversified financial services group, which offers a range of services such as investment banking, research, and asset management, Banque Misr will develop its non-banking financial services platform, with the aim of promoting financial inclusion across Egypt.

The second largest financial services deal of the year highlights interest from firms elsewhere in the MENA region: First Abu Dhabi Bank’s US$600 million purchase of Bank Audi Egypt, a subsidiary of Lebanese bank Audi Group. Following completion of the transaction, First Abu Dhabi will become one of the largest international banks operating in Egypt.

Another deal highlighting the international appeal of Egypt’s banking sector is Bahrain-based Arab Banking Corporation’s (Bank ABC) US$600 million purchase of BLOM Bank Egypt, announced in January. The deal is expected to more than triple Bank ABC’s market share in Egypt—doubling its number of branches while also diversifying its service offerings.

Outbound activity picks up 

Egyptian dealmakers, meanwhile, appear to be becoming more confident transacting deals overseas. The largest outbound deal of the year was driven by private equity interest in renewables—EFG Hermes’ acquisition of a 49% in Spanish renewable energy developer Ignis Energia, valued at US$726 million.

The deal is the latest in a string of cross-border deals targeting renewable assets, as the global drive to reduce carbon emissions fuels investment in the sector.

Another notable overseas deal was Elsewedy Electric’s US$60 million purchase of Indonesia-based PT CG Power Systems—a developer of power transformers. The deal marks Elsewedy’s bid to expand its presence in the Southeast Asian market, in line with its international expansion plans.


Following a challenging 2020, dealmaking targeting and conducted by Egyptian firms in 2021 displays a growing confidence in the market. The future looks set to improve further, as Egypt’s economy continues to emerge from the turmoil of the global pandemic. Economic growth is forecast to expand from 3.3% in 2021 to 5% in 2022, according to the World Bank. The improving economic outlook depends on the continued rollout of COVID vaccines, along with successful containment of future variants.

But 2021’s strong rebound in M&A activity highlights the enduring appeal in the market, particularly within the fast-growing TMT and financial services sectors, with local and international buyers alike quick to seize opportunities as they search for post-pandemic growth. Egypt has cemented its position as a key market for regional expansion plans within the MENA region.

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