The Financial Regulatory Authority (FRA) of Egypt announced in August of last year that Egypt’s Gulf Insurance Group (gig-Egypt) had made a $238 million ($196.96 million) compulsory purchase offer on the shares of AIG Egypt Insurance’s capital.
Headquartered in Kuwait, Gulf Insurance Company revealed that its GIG Egypt subsidiary has signed an acquisition convention for a 95.02% share of AIG Egypt for an equivalent amount of EGP196.97m($6.4m).
The purchase of up to 1.2 million shares of AIG Egypt, which corresponds to 100% of the company’s outstanding shares, has been approved by Egypt’s Financial Regulatory Authority (FRA).
According to a statement from the FRA, the agreement was approved at a cash price of EGP164.14595 per share, with the purchase of at least 75% of the shares of AIG Egypt.
Following the acquisition, Gulf Insurance Company plans to combine AIG Egypt with GIG Egypt, which is controlled by the Gulf Insurance Group (GIG) to a whopping 99%.
AIG Egypt has 1.2 million shares with a nominal value of EGP50 in its issued and paid-up capital, which is approximately EGP60 million. According to gross written premium, AIG Egypt owns a 1% share of the domestic non-life market in Egypt. (GWP).
It is anticipated that the acquisition will help Egypt’s insurance sector, a vital component of the national economy, flourish. Egypt has announced the State Ownership Policy to increase the private sector’s contribution to the nation’s economic activities from the present 30% to 65%.
According to the International Monetary Fund, the acquisition coincided with Egypt’s current objectives to close a financial imbalance of US$17 billion over FY2025/26. (IMF).
The property and liability insurance division of the GIG in Egypt is represented by gig-Egypt, which is one of the biggest companies active in the Middle East and North Africa’s insurance industry.
According to AM Best’s research from October 2022, GIG-Egypt has a non-life market share of roughly 7%, making it the third-largest non-life insurer in its home country of Egypt