The Sovereign Fund of Egypt and Concord International Investments to Establish a Diversified Healthcare Fund
The Sovereign Fund of Egypt (TSFE) and the New York based investment manager, Concord International Investments (Concord International), announced today the signing of a memorandum of understanding (MOU) which entails the cooperation of the two entities to establish a joint venture to raise and manage a specialized healthcare fund that will invest primarily in Egypt, as well as the Middle East and Africa.
The fund is one of several that will be established in the sector with the objective of creating a diversified healthcare platform that benefits from the ever-growing population in Egypt in need of various healthcare services. The fund also targets the creation of international export oriented healthcare entities covering the various activities, the unlocking of value in promising growth companies, under-utilized assets and untapped specialties to be able to capitalize on Egypt’s unique location and relatively lower services and production costs to serve Europe, the Middle East and Africa.
The fund’s initial target size is USD 300 million with the aim of achieving long-term capital appreciation by taking advantage of opportunities for direct investments in Egypt. The fund will act as a catalyst to attracting sizable foreign direct investments as well as identifying co-investment opportunities in significantly large projects.
“Investing in healthcare is a priority for the Egyptian government at this critical time when the world is facing the new COVID-19 pandemic crisis and the quality of the population’s healthcare is an integral part of the Egypt 2030 Vision for Sustainable Development. Focusing on the healthcare sector is directly related to the Egyptian government’s program to improve the quality of life for Egyptians by creating a fully integrated healthcare system that can improve healthcare indicators and achieve full coverage for all Egyptians. This diversified healthcare fund reflects the implementation of TSFE’s mandate to fast track attracting investments to public assets in a value accretive manner, while increasing private sector participation in the Egyptian economy, where the private sector is a main partner in the development path and will be responsible for implementing the greater share of the projects while the government takes on the regulatory role of setting standards and monitoring”, said H.E. Dr. Hala El Said, Minister of Planning and Economic Development and TSFE’s Chairperson.
“TSFE and Concord International have started the process to establish a joint venture management company to source and manage investments on a non-exclusive basis, in a healthcare services and pharmaceutical fund to achieve long term capital appreciation in public and private assets. We are delighted with this partnership and we look forward to benefit from Concord’s extensive experience across the healthcare spectrum”, said Ayman Soliman, TSFE’s Chief Executive Officer.
“TSFE’s role in attracting investments to such assets is key at this challenging time when there is a pressing need to invest in upgrading and expanding healthcare facilities. With the COVID-19 global pandemic still looming over the global economy, it is essential for us to be agile and create solutions that could and will elevate the strain the virus has caused over the healthcare systems in the region and on a global front. Both the healthcare and the pharmaceutical sectors have been on the top of the fund’s priority list, and today’s MOU signing culminates our collective efforts in securing FDI in those fields”, Soliman added.
“The Concord Group wishes to thank Her Excellency Dr. Hala El Said, Minister of Planning and Economic Development and TSFE’s Chairperson, and Mr. Ayman Soliman, TSFE’s Chief Executive Officer, for selecting us as a partner in creating this Fund. We believe that with The Sovereign Fund’s strong management team combined with strong government support and Concord’s seasoned management team we should reach the ambitious goals mentioned above.
The demand for this industry, which covers pharmaceutical producers, diagnostic service providers such as pathology labs, diagnostic imaging services, nursing care, hospitals, polyclinics and other specialized facilities, will continue to grow at an annualized double digit rate in some segments in the foreseeable future. The fund will be selecting promising investments from both private and public companies to create a diversified healthcare fund with the objective of maximizing the value of these assets over the investment horizon.
The tremendous opportunities for expansion in the Middle East and Africa using the resources of Egypt’s large growing market, provides the Fund with a unique opportunity”, said Mohamed Younes, the Chairman of Concord Group.
About Concord International Investments
Concord International Investments Group, L.P. is a New
York-based asset management firm founded in 1988, operating
continuously in Egypt since 1994 and its Cairo branch office
was the first foreign investment manager to get a license to
manage Egyptian mutual funds in Egypt. Concord was among the
first firms to create international offshore funds invested
in Egypt and listed on the London Stock Exchange and other
international markets. private equity transaction at that
time in Egypt. In addition, the Egyptian government in 1998
following the sharp decline in the market appointed Concord
to manage two government-owned funds of L.E. 800 million.
Concord was also among the first investment managers to
create a private equity fund to invest in Egypt in 2000.
Since then, it launched and managed three other private
equity funds fully invested in Egypt. It has extensive
experience across the healthcare spectrum as it invested in
Al Borg Laboratories, the largest pathology lab in Egypt as
well as Amoun Pharmaceuticals, the largest generic
pharmaceutical private company in Egypt (part of a 3
partners consortium alongside Citi Group Venture Capital
London and Capital International Los Angeles) and was able
to achieve superior returns on both investments via exits to
international strategic and financial investors. The Amoun
acquisition at USD 500 million was the largest Over the
years, a number of international firms selected Concord as
their local partner of choice (Credit Suisse, Caisse de
Depot of Quebec, ING Barings, Citi Group Venture Capital and
Capital International). Concord local partners have included
joint ventures for money management with Banque Misr and
National Bank of Egypt.
About The Sovereign Fund of Egypt (TSFE):
The Sovereign Fund of Egypt (TSFE) was established in 2018 to attract private investments to Egypt and promote and co-invest in state-owned assets to maximize their value and efficiency for future generations in partnership with the domestic and international private sector. It operates through unique legislation that allows it to operate with a private-sector mindset and according to private-sector laws and regulations. Its goals include investing in transactions that create jobs and increase the private sector’s contribution in the Egyptian economy. TSFE operates in accordance with global best practices in investment and ESG. The fund is overseen by an independent board of directors and general assembly. TSFE is a member of the International Forum of Sovereign wealth Funds (IFSWF) and One Planet Sovereign Wealth Funds (OPSWF).