Beltone Financial Holding’s Beltone Capital and investment arm NEPIT are taking a 51% stake in local seed distributor National Seeds Company (NSC) from Cairo Capital for Financial Investmentsin an EGP 140-306 mn transaction, according to a statement (pdf). The acquisition is expected to wrap up before the end of 2023.

There’s upside for Cairo Capital is NSC performs: The initial value of the acquisition is set at EGP 140 mn, but NEPIT could add up to EGP 166 mn to the value of the transaction if NSC’s operational and financial results met certain targets. The top-up would be paid in tranches.

Why this matters: Food security is a perennial issue for Egypt, where we live on about 5% of the nation’s total land mass (the vast majority of us along the Nile or on the coasts) and just 3.5% or so of the nation’s land is arable without intensive (and expensive) land reclamation programs. Growing and distributing more sees at home not just improves food security, but cuts the country’s import bill.

Who’s who? NEPIT, a wholly-owned Beltone Capital subsidiary, primarily invests in agriculture, food, and export-oriented food industries. NSC it is an Egyptian joint-stock company that produces and sells seeds and crops to the local and international markets.

Transaction timeline: The agreement needs regulatory approvals; Beltone expects the transaction to close by year’s end.

Tags: