GIHC Completes Eastern Co. Share Purchase

Global Investment Holding Co. (GIHC) has completed its acquisition of a 30 percent share in Eastern Co., according to reports by Reuters and Ahram Online. The United Arab Emirates company paid EGP16.4 billion ($531.6 million) for its stake in the Egyptian tobacco firm.

First announced in September, the deal is part of Egypt’s floundering privatization program. In December 2022, the government promised the International Monetary Fund that it would allow private companies a greater role in Egypt’s economy in exchange for a $3 billion, 46-month financial support package.

In February, the government announced a list of 32 companies for privatization, subsequently adding Eastern Co., Telecom Egypt, and Ezz El-Dekheila to the roster, Ahram Online reported in a separate article. The government hopes to attract $5 billion through privatization between October 2023 and June 2024.

While it has announced a number of sales to foreign investors in principle, the sale to GIHC is the first to go through. 

Under the agreement, the Emirati company will provide Eastern Co. with $150 million to procure tobacco materials for manufacturing.

In addition to CIHC, Eastern Co.’s primary shareholders are the state-owned Holding Company for Chemical Industries (20.9 percent), the Allan Gray Equity Fund (7.2 percent), the shareholders union of the Eastern Co. (6 percent), with the remaining 36 percent of shares trading freely on the stock exchange.