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valU kicks off EGP 4 bn securitization program: Consumer finance platform valU has issued EGP 1.42 bn worth of securitized bonds, its first issuance in a new EGP 4 bn securitization program, according to a statement(pdf). The two-tranche issuance has tenors of 12 and 36 months and ratings of Prime-1 and A.
This is one of the biggest securitization transactions of the year: Only Contact Financialand GB Lease have closed larger securitized bond issuances so far in 2023, according to data tracked by Enterprise.
And the second this year for valU: The company has now raised almost EGP 2.3 bn from securitizations this year following its EGP 856.5 mn issuance in March. The company is aiming to raise EGP 4.5 bn from securitized bond issuances this year, CEO Walid Hassouna told us earlier this year.
Another program in tandem: The company has another EGP 4 bn securitization program ongoing, which kicked off in September 2021. The consumer finance player earlier this year decided to double the size of the program from the initially planned EGP 2 bn. valU has completed around two-thirds of the program.
We knew a new program was on the way: Hassounatold us previously that the company was planning to launch a new EGP 5 bn securitization program.
What they said: “This securitization will further enhance our liquidity position and help us meet our ambitious growth targets for 2023. Building on the success of our previous securitizations’ performance, this offering includes a three-year tranche which will pave the way for us to further tap the debt capital market in more innovative ways in the future,” valU CFO Shokry Bidair said.
Advisors: EFG Hermes acted as the sole financial advisor, sole transaction manager, book-runner, and arranger on the issuance. It was also the issuance underwriter alongside Arab African International Bank, which also acted as custodian. Arab Banking Corporation and aiBank subscribed to the issuance. KPMG was the auditor, while ALC Alieldean Weshahi and Partners were counsel.
The securitization market in 2023: Companies have now issued almost EGP 17.7 bn of securitized bonds so far this year, up 54% from the same period last year.
