HSBC to sell retail portfolio to Emirates NBD

Monday, 3 Aug 2026

HSBC to sell retail portfolio to Emirates NBD

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Today at a glance

The Big Story Today

Emirates NBD to buy HSBC’s retail portfolio.

Industry

Can lease-to-own unlock Egypt’s industrial land market?

Startup watch

Simplex raises new funding round to boost CNC annual production capacity to 3.5k units.

WHAT WE’RE TRACKING TODAY

Egypt raised Israeli gas imports to pipeline limit after regasification unit went offline.

WHAT WE’RE TRACKING TODAY

The government is choosing between raising pump prices or hiking industrial gas tariffs.

WHAT WE’RE TRACKING TODAY

The US finalized anti-dumping duties, pushing total tariffs on Egyptian rebar past 100%.

M&A WATCH

Beltone VC partially exits proptech platform BirdNest at 80% IRR.

PLANET FINANCE

Joint US-Japan currency intervention buys Tokyo time for September rate hike.

BLACKBOARD

99% of students have opted into Egypt’s new Baccalaureate system.

WHAT WE’RE TRACKING TODAY

Israeli gas flows to Egypt hit the pipeline’s physical ceiling

Good morning, wonderful people. We’ve got a packed issue for you today, starting with a shakeup in the nation’s staid banking industry after HSBC Egypt confirmed that it will sell its retail unit to Emirates NBD.

The transaction could make Emirates NBD the nation’s sixth- or seventh-largest retail franchise and comes as the Dubai-based lender pushes aggressively outside the Emirates — it acquired earlier this summer a 60% stake in a big Indian bank.

HSBC Egypt says it’s not going anywhere: The bank is doubling down on its corporate and institutional banking business here, where it’s been a mainstay of the market for more than four decades.

MEANWHILE- Two stories today on opposite ends of the same problem: How to get more capital into the nation’s burgeoning manufacturing sector.

#1- The Madbouly government’s new lease-to-own system for industrial land. The logic is straightforward: make capital available for machinery and production lines instead of tying it up in land before a factory opens. The mechanism might help, but it doesn’t resolve two other issues plaguing the sector: lack of available land and lagging infrastructure.

#2- A CNC manufacturer is the ground-level version of the same goal: CNC machine manufacturer Simplex is raising a new round of financing to triple production capacity as a third facility breaks ground in Tenth of Ramadan. They also have a factory running in Saudi Arabia and contracts for distribution in Jordan, Kuwait, and Syria, a sign of what it looks like for Egyptian industrial manufacturing to scale up.

^^ We have more on all three stories in this morning’s news well, below.

BUT FIRST- Did you feel that earthquake? A 5.6 magnitude earthquake was felt across Egypt earlier this morning. The earthquake originated 38 km north of Suez, according to the National Research Institute of Astronomy and Geophysics.

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ARE YOU MORE OF A LISTENER? Morning Drive is a 10-minute rundown of today’s issue crafted for you to enjoy with your morning coffee, while getting the kids ready for school, or driving through the morning rush. And if you like it, tell your friends to tell their friends. They can find us on Apple, Spotify, or wherever they get their podcasts.

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An emergency gas boost

Gas flows from Israel’s Leviathan and Tamar fields to Egypt rose by 50 mmcf / d to 1.25 bcf / d as of Thursday, hitting the physical ceiling of what the cross-border pipelines can carry, according to an unnamed government official. The emergency increase follows last Wednesday’s drone strike that took the Energos Winter regasification unit offline.

The longer-term picture: A revised gas supply agreement outlines a phased increase in Israeli exports to Egypt, starting with an additional 200 mmcf / d, rising to 400 mmcf / d by January 2027 and 600 mmcf / d by January 2029, according to the official. However, the final phase depends on building a new pipeline and compression station, the official said.

REMEMBER- The government has been steadily stacking up Israeli gas commitments through 2043 to feed the state’s gas hub ambitions. Two Tamar partners signed a non-binding MoU last month for up to 80 bcm of gas between 2031 and 2038, layering on top of an existing USD 35 bn Leviathan agreement through 2040. This all connects to the country’s strategy to be the region’s gas transit and liquefaction hub rather than just burning it at home.

Picking up the fuel bill

The government is weighing two bitter pills to manage its energy bill: reinstate its capped fuel pricing mechanism or freeze prices at the pumps and force heavy industry to cover the difference in market prices. The government will decide by late September whether to return to its automatic fuel pricing mechanism — which limits pump hikes to 10% — or maintain its current “cost-recovery” framework, a government official tells EnterpriseAM. If the government chooses the latter, pump prices will remain frozen, and it will instead hike natural gas tariffs for energy-intensive industries to close the funding gap. The final decision rests on the stability of global oil prices, import volumes, and the EGP exchange rate.

A price increase is unavoidable at current international energy costs, former Egyptian Natural Gas Holding Company head Medhat Youssef tells us. European benchmark gas (TTF) is trading at USD 20.5 per mmBtu, climbing to USD 22 with freight, while diesel sits at USD 1.3k per ton before shipping. Even a maximum 10% hike under automatic pricing would not fully cover the rise in global costs, he argues.

Another option: Youssef proposes temporarily replacing some natural gas consumption with high-sulfur mazut, which he estimates would cost around USD 18 per mmBtu after accounting for additional maintenance and its 20% efficiency disadvantage. The cheaper substitute could help keep domestic petroleum-product prices stable until international markets settle, he says. The government turned to mazut alongside gas earlier this year to maintain power generation during supply disruptions.

IN CONTEXT- The government raised pump prices by up to 17.1% in March under the exceptional cost-recovery system, exceeding the automatic mechanism’s usual ceiling. It then raised natural gas prices for energy-intensive industries by USD 2 per Btu in May and began reviewing a more flexible industrial gas-pricing formula. Prime Minister Mostafa Madbouly said last month that quarterly automatic pricing would return this quarter, but the latest discussions suggest the government could instead hold pump prices and recover more of the gap from industrial users. The decision comes as the fuel import bill rises and the government looks to hedge 65% of its fuel imports against further global price shocks.

The metal tariff stack

The US Commerce Department has finalized anti-dumping duties of 34.2-52.73% and a 23.27% countervailing duty on Egyptian rebar, according to the department’s final determination. Ezz Steel and most Egyptian exporters face the 34.2% dumping margin, while El Marakby Steel and Suez Steel were assigned the higher 52.73% rate.

Those duties sit on top of the separate 50% Section 232 tariff on steel, taking the cumulative burden to 107.47% for Ezz and most exporters and 126% for El Marakby and Suez Steel. Steel is excluded from the new 12.5% tariff applied to most Egyptian goods after Washington’s broader emergency tariff regime was struck down, as it remains covered by the separate Section 232 metals framework.

What’s next: The US International Trade Commission still needs to determine whether Egyptian imports injured or threatened the domestic rebar industry. An affirmative decision would see the duties converted into permanent orders, while a negative ruling would end the anti-dumping and subsidy cases.

IN CONTEXT- Washington launched the two investigations in June 2025 after six US steelmakers alleged that Egyptian rebar was being sold below fair value and benefiting from state support. The preliminary subsidy duty imposed in January had already lifted the total burden to nearly 80% and effectively frozen shipments, with the still-pending dumping case expected to push the tariff wall beyond 100%.

Monday morning kudos

A shoutout is in order for our friends at EFG Hermes, whose securities brokerage division ranked first across five MENA markets in 1H 2026, according to a press release (pdf). EFG Hermes secured the top spot in Egypt, Kuwait, and the UAE, topping the EGX, Boursa Kuwait, Dubai Financial Market, Abu Dhabi Exchange, and Nasdaq Dubai, the company said, citing official market share data. The brokerage also ranked number 10 in Saudi Arabia, with its market share rising to 6.5%.

“Ranking first across five MENA markets in the first half of 2026 is a powerful endorsement of the trust our clients place in EFG Hermes and the strength of the platform we have built across the region. This is not a one-market story; it is the result of years of investment in talent, technology, execution quality, and deep client relationships across our footprint,” EFG Hermes Group Head of Brokerage Ahmed Waly said.

PSA-

WEATHER- It’s another sunny day in Cairo, with a high of 37°C and a low of 25°C, according to our favorite weather app.

It’s a little cooler in Alexandria, with a high of 33°C and a low of 24°C.

The big story abroad

The regional war may be looking at another halt with US-Iran negotiations set to resume today, US President Donald Trump said, without confirming a deadline for an agreement. Trump said he called off a planned strike against Iran, characterizing it as the “biggest attack since World War II.” Iran’s state media reported that Foreign Minister Abbas Araghchi spoke with Saudi and Pakistani officials to coordinate diplomatic efforts.

One of the world’s largest pharma groups may be on the way, as UK-based AstraZeneca conducts talks to merge with US drugmaker Bristol Myers Squibb. The resulting entity would be valued at around USD 400 bn. The companies have discussed a potential tie-up in recent months and could reach an agreement soon, though talks may still be delayed or fall apart.

Apple has put a cap on incoming software bug submissions from researchers after its defense system was swarmed with AI-generated reports that hallucinate non-existent risks. The iPhone maker says it is facing an industry-wide challenge as generative AI tools reshape cybersecurity.

Hollywood has another hit on its hands, as Sony Pictures’ Spider-Man: Brand New Day opened to some USD 927 mn in global box-office revenues, becoming the second-biggest film debut ever. The web-slinger’s latest is well positioned to overtake the year’s other major hits, namely Toy Story 5, The Odyssey, and The Super Mario Galaxy Movie.

*** It’s Blackboard day: We have our weekly look at the business of education in Egypt, from pre-K through the highest reaches of higher ed.

In today’s issue: Egypt’s new Baccalaureate system has all but replaced Thanaweya Amma for next year’s class, but has it actually put a dent in Egypt’s tutoring economy?

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electricity energy oil and gas WHAT WE’RE TRACKING TODAY

Somabay continues its commitment to international sport by hosting the Egypt International Teen Championship from 25–27 September 2026.

Registration is now open for the US Kids Golf International Teen Series event, which will welcome leading junior golfers aged 13–18 from Egypt and overseas to compete at the award-winning Somabay Golf Course.

The Big Story Today

HSBC to sell Egyptian retail portfolio to Emirates NBD

HSBC is exiting retail banking in Egypt after 44 years in the market but has no intention of pulling back from corporate and institutional banking, which account for the lion’s share of its business here. The lender said yesterday that it has reached a definitive agreement with Emirates NBD Egypt that will see it hand over its entire retail business for an undisclosed sum, according to statements from both banks released after banking hours yesterday (here and here, pdf).

It’s the second significant regional move this summer for Emirates NBD after its USD 2.8 bn acquisition in June of a 60% stake in India’s RBL Bank. The group operates in 13 countries with more than 25 mn active customers and some USD 360 bn in total assets. ENBD, led in Egypt by Amr El Shafei, is majority controlled by the Emirate of Dubai through the Investment Corporation of Dubai and Dubai Holdings, which together hold almost 56% of the bank’s shares.

If it goes through, the transaction will make Emirates NBD the sixth or seventh-largest retail franchise in Egypt, by our maths, behind heavyweights NBE, Banque Misr, CIB, Banque du Caire, and QNB Al Ahli.

The sale is the latest in a string of retail exits globally as HSBC refocuses under Group CEO Georges Elhedery. The transaction includes all of HSBC Egypt’s retail loans, deposits, accounts, branches, ATMs, and the staff that support the business unit. HSBC Egypt will continue to serve corporate clients.

The transaction is still subject to regulatory approvals from the Central Bank of Egypt and the usual conditions precedent for a transaction like this — don’t expect it to close before 2H 2027. Neither party said how much the transaction was worth or put a number on how many accounts would be transferred to Emirates NBD, although HSBC said the agreement is expected to generate a pre-tax gain of around USD 300 mn for HSBC Group.

REFRESHER- The lender put its retail business in Egypt under strategic review last October, making clear at the time that its corporate and institutional banking activities weren’t going anywhere. By February, HSBC was reportedly weighing bids from at least four suitors for the portfolio, including Emirates NBD, QNB Al Ahli, and EGX-listed heavyweight CIB. Four institutions, including CIB, ultimately did due diligence on HSBC Egypt’s retail portfolio.

Egypt itself has seen a version of this play out before — think Citi’s sale to CIB. (More on that in a moment, below.)

What happens next

The Central Bank of Egypt will review whether Emirates NBD has the capital, liquidity, and operational capacity to absorb the new accounts and liabilities without straining its own financial health. The regulator also requires the two banks to devise a customer transition plan covering everything from account continuity to how loyalty points get handled.

It’s business as usual for HSBC Egypt’s clients, staff, and branches, at least for now, HSBC says, and the precedent for how these transactions play out backs that up. “There are no immediate changes for HSBC Egypt’s retail customers and their HSBC products,” the release read.

“Clients won't feel the impact of the transaction on announcement day,” banking and finance analyst Hany Abou El Fotouh tells EnterpriseAM. “But the transfer of this mass of deposits, loans and customers could change the competitive map between banks.” He puts HSBC Egypt’s active retail customer base at around 330k. Heading into the transaction, HSBC’s retail deposit base was a bit more than 1.5x the size of ENBD’s and its loan book about 80% of the size of ENBD’s, Abou El Fotouh says.

HSBC is selling a strong business

The retail business sits firmly in the black, posting an EGP 948.4 mn bottom line in 1Q 2026, despite being down 8.8% from EGP 1.04 bn a year earlier, per its 1Q results (pdf). Retail banking accounted for a little under 16% of the EGP 6.0 bn in net income HSBC made here in the first quarter of this year. Corporate banking accounted for nearly 70% of the bank’s bottom line, while investment banking and other activities delivered c. 15%.

What we know is in the book: HSBC Egypt’s retail arm held roughly EGP 142.8 bn in deposits against loans of EGP 18.9 bn in 1Q — a loan-to-deposit ratio of around 13%, making this a funding base more than a lending business. Personal loans accounted for EGP 13.6 bn of that, while credit cards stood at EGP 5.2 bn. The credit quality is pristine, with provisions against bad debt running at roughly 0.5% of the portfolio.

This isn’t a verdict on Egypt

HSBC’s move is part of a global retreat from retail banking that extends well beyond Egypt. The process traces back to mid-2023, when then-CFO Georges Elhedery put 12 countries on an exit watchlist in a pivot toward Asia, where the group generated 87.2% of its net new money in 1Q 2026, up from 78% in 2023. Elhedery was named group CEO in 2024, and months later the bank said it would simplify and restructure its organization into four core businesses: Hong Kong; the United Kingdom; corporate and institutional banking; and international wealth and premier banking.

While that meant retail was taking a back seat, HSBC says it’s very focused on the wholesale banking side of the business here in Egypt. HSBC Egypt’s CEO Todd Wilcox told us in February the bank is “squarely focused on the needs of our corporate and investment banking clients” here, pointing to roadshows and reverse roadshows connecting local issuers with investors in China, Singapore, and the UK, and to an inflow of Chinese and Turkish manufacturers drawn by Egypt’s cost advantages.

Zooming out: “This sequence of decisions places Egypt inside a broader rearrangement of capital and geographic spread at the group, and weakens any reading of the [agreement] as a standalone judgement on the Egyptian market,” Abou El Fotouh tells us.

Where else is HSBC pulling back?

HSBC has fully exited retail banking in Canada, France, South Africa, Bahrain, and Sri Lanka as part of what it calls the “ongoing simplification of HSBC Group.” It sold its Argentina retail operations to Grupo Financiero Galicia for USD 550 mn, and is in mid-transition in Indonesia and Australia, where a USD 25.3 bn mortgage and loan book is going to Blackstone, while the remaining retail business winds down by 1H 2027. Bangladesh is being closed outright rather than sold, while Malta remains under review. In the US, HSBC narrowed its retail footprint in 2021 and is now also exiting its business banking unit.

HSBC isn’t alone: Multinational banks are “right-sizing” their emerging market operations, shedding capital-intensive retail arms to double down on higher-margin institutional and wealth management businesses.

We’ve been here before, too: Back in August 2015, Citi’s Egypt unit sold its retail portfolio to EGX-listed CIB — Egypt’s largest private-sector institution — handing over client accounts, its credit card portfolio, book of personal loans, and network of branches and ATMs. Many of Citi’s 900 employees joined CIB at the time, moving over at the same time as some 100k accounts, 90k credit cards, and nine branches. Neither bank disclosed a price at the time, and the transaction wrapped up over the course of 2016 and into 2017 as the CBE shepherded the pair through the process.

Who the exit (eventually) affects and how

HSBC Egypt runs three retail tiers, including a basic current account requiring a monthly gross salary of EGP 10k, Advance at EGP 500k in average monthly balances or EGP 30k in monthly salary, and Premier at EGP 2 mn or EGP 70k. The bars for the top two tiers have climbed steeply in recent years as the EGP has slid against the greenback: The minimum balance for Premier nearly tripled from EGP 750k in June 2024, and the threshold to be classified as Advance doubled from EGP 250k in May 2025.

OUR TAKE- That puts a more concentrated, higher-balance book in Emirates NBD’s hands than HSBC was running two years ago.

News of the sale is just the beginning: “The consequential details will come later: fees, interest rates, account and card numbers, and the mechanism for transferring service from one bank to another,” Abou El Fotouh tells us. “These details are the real test, because they touch the daily relationship between customer and bank, not just the sign on the branch.”

Where that leaves the rest of the market

Egypt’s banking industry is simultaneously crowded and top-heavy. We have 37 licensed banks: Standard Chartered arrived in 2023, and OneBank registered as a digital bank this January, but the so-called Big Five hold 69.7% of sector assets, 67.2% of deposits, and 73.1% of loans. Large portfolios changing hands tend to reinforce that concentration, including FAB’s acquisition of Bank Audi and Bank ABC’s purchase of Blom Egypt. What distinguishes this transaction, Abou El Fotouh notes, is that what’s transferring is a segment inside an existing bank, not the bank itself.

“The real value of the transaction will not be measured by portfolio size alone, but by the market’s ability to turn a transfer of ownership into better service and wider competition for the customer,” Abou El Fotouh tells us.

The fine print

HSBC by the numbers: The bank opened here in 1982 as the Hong Kong Egypt Bank and today has roughly 1.5k staff and more than 40 branches. Egypt is also home to an HSBC “global service center” that provides support to HSBC operations globally.

What’s next: HSBC Group will publish its 1H results tomorrow, which could give us more color on the transaction, though the bank isn’t required to put a figure on the deal while the transaction is still pending regulatory approval.

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Industry

Can lease-to-own unlock Egypt’s industrial land market?

The government has launched a new lease-to-own system for industrial land that allows manufacturers to spread land costs over up to 21 years and seek ownership after one year of operations, according to an Industry Ministry statement.

The mechanics: Investors can lease plots for seven to 21 years at an annual rent equivalent to 5% of the land’s price. The rental value will be reassessed after years seven and 14 if the investor has not applied for ownership. Once a factory has completed one year of actual operations, the investor can apply to buy the plot. Rent already paid will be deducted from the purchase price, with the investor paying 25% of the remaining value and settling the remaining balance over three annual installments.

Another hit on land hoarding: In parallel, the ministry is temporarily suspending Decision 107 of 2026 from mid-August until the end of the year, lifting the three-year lock-up period on selling industrial land and factories, giving investors the freedom to transfer ownership and exit without being tied up by red tape. The goal? Curb the secondary market speculation that has caused land prices to soar in areas like 10th of Ramadan.

The lease-to-own system responds to investor demands for more flexible land-allocation options, Tenth of Ramadan Investors Association head Samir Aref tells EnterpriseAM. Giving manufacturers the choice between direct ownership, usufruct, and lease-to-own arrangements would allow them to preserve a larger share of their capital for operating expenses and encourage additional investment, he said.

Lower land costs unlock expansion: Federation of Egyptian Industries member Alaa Nasr agrees, telling us that the low 5% annual rent will leave more funding available for machinery and working capital, potentially unlocking a new round of factory expansions outside established industrial cities.

A fully digital process: The application and payment process will run electronically through the Egypt Digital Industrial Platform, which was initially launched in September 2024 strictly for land allocation and was expanded earlier this year to consolidate licensing, building permits, and payments into one centralized system.

Nine routes to a factory

Lease-to-own is just one of nine mechanisms the ministry is deploying to get industrial land into the hands of producers. The rest of the playbook includes:

Quarterly land offerings to cut down the time investors spend waiting for new tenders;
Direct ownership of industrial plots;
Usufruct arrangements;
Ready-built units, with the state currently sitting on an inventory of around 4.8k units in state industrial complexes;
Leaning on private developers by nearly doubling the number of private industrial developers to 30 from 16;
The Productive Village program, which targets 100 factories over three years based on the competitive advantages of each governorate;
A digital marketplace for stalled factories that allows investors to partner up and reuse existing, idle production assets;
Suspending the three-year lock-up on land sales, as we noted above, giving investors a temporary window from mid-August through year-end to exit or transfer assets without being penalized.

The Tenth of Ramadan dilemma

The new mechanisms only address part of the problem in established industrial cities. Tenth of Ramadan faces a shortage of serviced plots despite strong demand from both local and foreign investors, Aref says. Official land priced at around EGP 6k per sqm has reportedly traded for as much as EGP 30k per sqm in the secondary market, as we reported previously. The ministry is currently servicing a 10k-feddan expansion, according to Aref, and the state has made ready-built industrial units available in the Tenth of Ramadan with different ownership and payment systems in the meantime. Separately, the Industrial Development Authority has sought EGP 21 bn to service additional industrial land.

More payment options also need to be paired with tighter development deadlines, as investors holding plots without building are preventing productive projects from entering, Aref says. The ownership condition in the new system partly addresses that concern: investors cannot apply to buy a leased plot until the factory has operated for one year.

IN CONTEXT- The government has also launched a campaign to reclaim idle plots and industrial units from investors who have failed to develop them, beginning in Tenth of Ramadan and Badr City, as it looks to return unused land to productive activity.

Upper Egypt faces other hurdles

Land is available in Upper Egypt, but incomplete infrastructure keeps investors away. Industrial land prices in Sohag have gone from coming at no charge to around EGP 1.2k per sqm, Sohag Investors Association head Mahmoud El Shandawily tells EnterpriseAM. He says more flexible payment options should help, but the bigger barrier is utilities. The Al Ahaywa East Industrial Zone, established in 2000, still lacks water, electricity, basic services, firefighting facilities, and a police point. Roads have improved, including the link to Safaga Port, but attracting manufacturers will require logistics zones, freezones, gas connections, complete utilities, and lower operating costs, alongside flexible land-allocation systems, he says.

Financing remains the missing piece: Aref and El Shandawily agreed that reducing the upfront cost of land will not be enough without affordable financing for the rest of the project. They called for a dedicated financing mechanism for industrial investments, lower interest rates on factory loans, and a stronger role for the Credit-Risk Guarantee Company. Lease-to-own can preserve capital at the land-allocation stage, but investors will still need funding for construction, machinery, utilities, working capital, and the start of operations.

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Industrial Development Authority industry

Startup watch

Simplex raises new funding round to up CNC annual production capacity to 3.5k units

Local CNC machine manufacturer Simplex is raising a new funding round to bankroll its expansion in Tenth of Ramadan City, which will push its annual production capacity to 3.5k machines, CEO Ahmed Shaaban (LinkedIn) tells EnterpriseAM. The company aims to close the active round by the end of the year to finance the build-out. Simplex now runs one 5k sqm plant and one 10k sqm plant in Tenth of Ramadan City, while a third 20k sqm facility broke ground last week. Current annual production capacity has increased to 1.5k machines, up from 500, and will reach 3.5k once the third facility is built, Shaaban says.

The financing mix: “The financing comes from the previous round, plus we have an ongoing funding round that hasn’t closed yet,” Shaaban says, adding that the company also “secured an angel bridge round of about USD 1.5 mn.” He declined to disclose the target size of the active round.

REFRESHER- An undisclosed Egyptian investor picked up a minority stake in Simplex in October 2024 with an EGP eight-figure transaction, with proceeds earmarked to finish the Tenth of Ramadan factory, fund R&D, and back expansion into Tunisia, Morocco, and Algeria. Qatar was later named as a target market as well.

SOUND SMART- CNC, short for computer numerical control, is a computer-controlled piece of machinery used in industry to cut and shape materials with a very high level of precision and repeatability. It is used to make parts for everything from cars to factory equipment.

Taking business abroad

Looking overseas: “We are currently focused on partnering with an international strategic player outside Egypt, someone with deep industry expertise so we can learn and scale further,” Shaaban tells us. That international search comes after talks with Elsewedy Electric over a domestic stake sale fell through in 2024 over disagreements on the size of the stake.

The CNC manufacturer also inked new partnership and agency agreements in Jordan, Kuwait, and Syria, which will allow distributors there to buy and resell its machines locally, Shaaban says. The release didn’t name either partner or disclose contract terms. The company is also in talks with potential partners in Pakistan, South Africa, and Angola, Shaaban notes, with three to five new markets expected to close before year-end.

Export volume is still a small slice of the business, for now. Simplex ships about 15% of what it makes today, but the company is “heavily focused on exporting,” Shaaban notes. Looking ahead, the target is to “hopefully reach 50% within five years,” he adds.

ICYMI- In January 2025, Simplex signed an MoU with Saudi Arabia’s National Industrial Development Center to build its first Saudi factory, a 20k sqm plant in Riyadh, funded by its Saudi partner. The following month, it confirmed securing USD 13 mn for that project, which began operations in 1Q 2026.

About Simplex

Simplex’s machinery feeds into the supply chains of the country’s biggest industrial companies, serving over 4.5k clients and exporting to 34 countries, Shaaban says. “In furniture manufacturing, we supply Mobilya, In & Out, Ikea, and similar companies,” he says. The company’s reach also extends to home appliances (El Araby, Fresh, Midea, and Kiriazi), the automotive sector (MCV, Volvo, Mercedes, and El Nasr Automotive), infrastructure (Arab Contractors, Elsewedy, and Orascom), and electrical (Elsewedy, ABB, Schneider, and Siemens).

A local manufacturing monopoly: The company designs, assembles, and manufactures CNC machines domestically rather than relying on the import-to-resell model that dominates the market. “There are a few manufacturers, but not for our specific types of machinery, and not at our corporate scale,” Shaaban notes, adding that Simplex is “unfortunately” the only significant player in the market.

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M&A WATCH

Beltone VC partially exits proptech platform BirdNest at 80% IRR

Beltone Venture Capital has partially exited its investment in Egyptian proptech and hospitality platform BirdNest, generating a 3.5x return on invested capital and an 80% internal rate of return (IRR) over a two-year holding period, the company said in a statement (pdf). The transaction covered both Beltone VC’s direct investment and its stake through its joint fund with UAE-based Citadel International Holdings. Financial terms were not disclosed.

Why it matters: An 80% IRR over two years stands out at a time when the 2024 devaluation has eroded returns across much of Egypt’s VC ecosystem. It also marks another successful realization for Beltone Venture Capital while allowing it to stay invested in a company it believes still has meaningful upside.

Beltone VC remains invested in BirdNest’s next phase. “This partial exit enables us to return capital to our investors while retaining a strategic stake in BirdNest. We remain committed to supporting the company’s next phase of growth through Beltone’s financial ecosystem and capabilities,” CEO and Managing Partner Ali Mokhtar said.

What’s next: More than 10x growth in USD-denominated revenue over the past two years has helped BirdNest reach profitability, setting the company up for its next phase of expansion. “We remain focused on creating sustainable long-term value and redefining hospitality through technology and exceptional guest experiences,” cofounder and CEO Mostafa Elnahawy said.

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Beltone VC M&A Watch

Also on our Radar

Capital Limited is seeking nine gold blocks after years of drilling for others

The drilling contractor for Sukari operator AngloGold Ashanti wants to produce its own gold: UK-listed mining services firm Capital Limited is looking to secure nine gold exploration blocks in the Eastern Desert, according to an unnamed government official. The firm plans to leverage its existing footprint as a drilling contractor for AngloGold Ashanti and Canadian junior Aton Resources to transition into a direct gold producer in Egypt. The requested blocks are part of the government’s newly offered 260-area gold concession map.

Why it matters: This move is what the government’s mining overhaul was designed to encourage. The Mineral Resources and Mining Industries Authority launched its open-sector exploration bid round in June, replacing sporadic auctions with a continuous application window to cut bureaucratic friction. The goal is to attract experienced foreign players like Capital Limited, which previously explored the Eastern Desert alongside an Emirati player before the latter exited the concession in 2021. This all feeds into the Oil Ministry’s target to raise the mining sector’s share of GDP to 5-6% by 2030, up from less than 1% currently.

Perenco moves onshore

A new batch of exploration agreements just cleared the House of Representatives, which gave its final approval to four draft laws authorizing the Oil Minister to sign contracts with Egyptian Natural Gas Holding Company (Egas) and Egyptian General Petroleum Corporation (EGPC) across North Sinai, the Nile Delta, the Mediterranean, and the Eastern Desert, Reuters reports, citing local media.

Egas and Perenco North Sinai Petroleum will explore the Al Fayrouz onshore block in North Sinai, with a 3D seismic survey and one exploratory well committed. Unlike the other three, the explanatory memo shows Perenco came in with a direct, unsolicited offer for the block rather than through a competitive round.

REMEMBER- Egas awarded these blocks in June 2025, when Chevron, Shell, Eni, Cheiron, IPR, and Perenco committed a combined USD 245 mn across six blocks and at least 13 exploratory wells. The latest batch locks in three of those: Perenco’s Al Fayrouz block, IPR South Desouk’s North Tanta onshore area in the Nile Delta, and Cheiron Egypt Delta’s East Alexandria offshore block in the Mediterranean, where Cheiron is committing at least USD 42.2 mn and three exploratory wells.

MEANWHILE- Saudi Arabia’s Ardiseis, China’s BGP, and US-based WesternGeco are reportedly competing for an EGPC tender to carry out the first phase of a seismic survey covering more than 50k sq km of the Western Desert near the Libyan border. The resulting data will be used to divide the territory into exploration blocks for subsequent offerings. The government is targeting 101 oil and gas exploration wells this year, including 67 in the Western Desert.

The triangle takes shape

Elsewedy Industrial Development has signed the Golden Triangle Economic Zone Authority’s first industrial-developer contract, which plans to develop a 6 mn sqm industrial and logistics zone in Safaga over three phases, according to a statement from the authority. The zone will focus on mining and mineral-based manufacturing, alongside warehousing, logistics, and export services. Plans also include a branch of Elsewedy Technical Academy to train workers for the factories expected to set up shop in the zone.

IN CONTEXT- The signing moves the project beyond the MoU Elsewedy signed last August and delivers the final contract, which was flagged as imminent in June. It also adds an industrial backbone to a wider Golden Triangle pipeline that includes Xingfa’s planned USD 2 bn phosphate and specialty-chemicals complex and the USD 200 mn Safaga 2 multipurpose terminal, which began trial operations in June.

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PLANET FINANCE

Joint US-Japan currency intervention buys Tokyo time for a September rate hike

Tokyo and Washington are jointly stepping in to arrest the JPY’s slide to 40-year lows, but the intervention is merely buying time for a fix that currency purchases alone cannot deliver: a Bank of Japan (BOJ) rate hike, now penciled in for as early as September. Finance Minister Satsuki Katayama is expected to confirm the joint action today, according to two Japanese officials cited by Reuters, marking the first such coordinated move since 2011.

The mechanics of the rescue: Japan bought JPY and sold USD in New York hours on Thursday, with BOJ data suggesting a massive outlay of up to USD 58.97 bn, though confirmed figures won’t be out for another month. Tokyo intervened again in New York hours on Friday. The US side was executed quietly: the Treasury told banks on Friday to stand ready, and the New York Fed sold EUR for JPY on the Treasury’s behalf through Goldman Sachs and Morgan Stanley, according to the Financial Times, but no amount was disclosed.

A highly visible to-do list: While the exact US spend wasn’t disclosed, Treasury Secretary Scott Bessent accidentally flashed his notepad during a televised Camp David cabinet meeting on Friday. The top item? “To Do: Buy Japanese Yen (JPY) USD 5-10 bn.”

Does this actually work? Japan has intervened alongside the US or other G7 partners five times since 1985 and gone it alone eight times, according to an analysis by currency strategist Brent Donnelly of Spectra Markets, separately cited by Reuters. His analysis shows most of the joint interventions coincided with an actual turn in the USD/JPY trend. However, Nomura currency strategist Dominic Bunning remains skeptical, calling the current move “tacit support more so than explicit coordinated intervention,” rather than 2011-style coordination.

Why September matters more than today: The BOJ held its rate at 1% on Friday but warned for the first time that underlying inflation could exceed its target, marking the clearest signal yet that a hike is coming as soon as next month. Pundits think intervention won’t help the JPY in the longer term unless the BOJ actually follows through, and unless US rates move lower too.

South Korea is also playing defense: Seoul sold USD alongside Japan on Thursday, briefly lifting the KRW 2% to a nine-month high. But the KRW’s broader 7.5% surge this month is coming from a different source entirely: Korean companies repatriating USDs, not intervention.

OUR TAKE- Washington is helping prop up the JPY because the alternative isn’t appealing.

Japan is one of the largest foreign holders of US government debt. If Tokyo is forced to sell down its Treasury holdings to fund a unilateral JPY rescue, it could trigger a selloff in US debt and cause an unwelcome spike in US yields. Japan’s Finance Ministry posted on X over the weekend that it has “a broad range of tools,” including access to the Fed’s Foreign and International Monetary Authorities (FIMA) Repo Facility, which lets it raise USD liquidity without selling its Treasury holdings outright.

MARKETS THIS MORNING-

Asian markets kicked off the month in the red, led by a sharp decline in South Korea’s Kospi, which dropped 4.5% in early trading, capping off a turbulent July during which it slumped 22%. The drop-off coincided with a sell-off among heavyweight chipmakers, driven by mounting headwinds that include rapid advancements in China’s AI and semiconductor sectors. Japan’s Nikkei wasn’t too far behind, slipping 2.2%.

EGX30	54,286	+1.6% (YTD: +29.8%)
USD (CBE)	Buy 50.35	Sell 50.48
USD (CIB)	Buy 50.30	Sell 50.40
Interest rates (CBE)	19.00% deposit	20.00% lending
Tadawul	10,706	+1.1% (YTD: +2.1%)
ADX	9,915	+0.4% (YTD: -0.8%)
DFM	5,796	+0.1% (YTD: -4.2%)
S&P 500	7,490	+0.7% (YTD: +9.4%)
FTSE 100	10,868	-0.3% (YTD: +9.4%)
Euro Stoxx 50	6,358	+0.2% (YTD: +9.7%)
Brent crude	USD 83.64	-4.9%
Natural gas (Nymex)	USD 2.73	-0.6%
Gold	USD 4,126	+0.5%
BTC	USD 63,421	+1.0% (YTD: -27.6%)
S&P Egypt Sovereign Bond Index	1,087	+0.1% (YTD: +9.5%)
S&P MENA bond & sukuk	149.83	0.0% (YTD: -1.4%)
VIX (Volatility Index)	15.99	-6.4% (YTD: +7.0%)

THE CLOSING BELL-

The EGX30 rose 1.6% at yesterday’s close on turnover of EGP 10.4 bn (8.7% above the 90-day average). Regional investors were the sole net sellers. The index is up 29.8% YTD.

In the green: Telecom Egypt (+9.2%), AMOC (+7.5%), and Kima (+6.2%).

In the red: Palm Hills Developments (-0.1%).

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Our weekly deep dive into education in Egypt, from K-12 to post-secondary.

Published every Monday in EnterpriseAM.

Read Blackboard

BLACKBOARD

99% of students opted into Egypt’s new baccalaureate system

One exam has ruled Egyptian teenagers’ fates for decades and fed one of the country’s biggest private industries — now it has a rival. An Education Ministry official tells EnterpriseAM that opt-in for the new Egyptian Baccalaureate has hit 99% for the 2026-27 academic year, with roughly 832k students choosing the track over Thanaweya Amma. The official credits a system built to deliver “solutions to the problems facing Thanaweya Amma, including reducing reliance on private lessons and tutoring centers, and easing the financial burden on Egyptian families.”

Easing the burden of private tutoring fees has always been central to the reform. Parliamentary and Legal Affairs Minister Mahmoud Fawzy told the House Education Committee in July 2025 that the reform was being pursued in an effort to “eliminate the phenomenon of private tutoring that burdens Egyptian families” and to “relieve the burden and hardship on Egyptian families,” according to a statement.

The baccalaureate system was designed based on international models, but it deliberately preserves Arabic-language and national-identity subjects in the Egyptian version, the official says.

AI is also playing a role: The ministry piloted an AI-powered platform aimed at cutting reliance on private lessons. This isn’t the first time the ministry has utilized AI. Egyptian AI-tutoring startup Faheem, whose curriculum-aligned platform helps students study and revise, previously told EnterpriseAM its performance data feeds into Education Ministry analytics used to guide investment and policy decisions.

The baccalaureate system reduces the need for tutoring by offering fewer subjects. Dr. Hassan Sayed Shehata, a contributor to the baccalaureate’s curriculum development and professor of Curricula and Teaching Methods at Ain Shams University’s Faculty of Education, tells EnterpriseAM the number of subjects drops sharply by design: five subjects in the first year, four in the second, and just two by the third, with neither Arabic nor English among them by then. For the final year, “the student won’t need private tutoring,” Shehata says.

The curriculum is still being updated as enrollment continues to grow. “We’ve just finished the new curricula, and they’re now under review ahead of publication,” Shehata says. He describes an Arabic-literature curriculum built around 20 topics, plus a separate booklet on narrative writing, an English curriculum matched to International Baccalaureate standards, and a math curriculum modeled on Japanese and Korean systems, with each trimmed to nine topics per term.

Teacher training and textbook review are running on separate tracks. Governorate-level video-conference sessions prepare high-performing teachers, who then pass that training on to colleagues elsewhere, Shehata says. That’s distinct from Education Minister Abdel Latif’s agreement with the International Baccalaureate Organization (IBO), which reviews the frameworks behind the new textbooks rather than classroom delivery.

The system is designed to funnel students into four tracks that correlate to job-market demand: Medicine and Life Sciences, Engineering and Computer Science, Business, and Arts and Humanities. All four are tied to university majors, and students have the option to add more subjects and pursue more than one track.

Final exams are at no charge, though retakes have a fee. Grade 11 students sit a first attempt in May at no charge, with a second in July; Grade 12 students sit their first attempt in June, also at no charge, with a second in August. Every subsequent attempt carries a flat EGP 500 exam fee, waived for low-income students drawn from the ministry’s own case database, Abdel Latif told the House Education Committee in January 2025.

The final exams cover seven subjects worth a total of 700 points, with one exception. Each subject is scored out of 100, with the higher of two attempts counted toward the total. Religious Education is the exception: it carries its own 70% passing threshold and sits outside the 700-point total entirely, according to Abdel Latif’s July 2025 statement.

How the four tracks will correlate to university majors is still being decided by the Supreme Council of Universities, per Fawzy’s July 2025 statement. According to Shehata, this gap between tracks and majors is part of how the new system is building stronger ties to labor-market needs. That echoes Higher Education Minister Ayman Ashour’s comments linking the reform to Egypt’s push into AI, genomic medicine, and big data in July 2025.

Students will also have the option to attend a foundational year of university after their final retake, which allows them to begin attendance before choosing a faculty, Shehata says. This is similar to the American university model, which allows students to wait until their second year of university to declare a major.

The baccalaureate system is quickly outpacing Thanaweya Amma in enrollment. Our source at the Education Ministry put the opt-in rate at 99% for the 2026-27 academic year, up from the 95% rate Abdel Latif referenced in May, an increase which is likely explained by weeks of continued sign-ups since then.

One industry insider is willing to call an end date for the old way. Private School Owners Association Chairman Badawy Allam tells EnterpriseAM he expects “next year to be the last year for administering Thanaweya Amma exams alongside the first year of the two-year baccalaureate exams,” given how many incoming students are choosing the new track. Allam says the shift is already squeezing tutoring-center revenue by trimming subjects and narrowing what counts toward passing and claims it has saved the state a significant sum on exam administration — a figure the ministry hasn’t confirmed.

REMEMBER- The reform was set in motion last year after Parliament amended the Education Law in July 2025. President Abdel Fattah El Sisi signed it into force as Law 169 of 2025, published in the Official Gazette in August 2025, with the Supreme Council of Pre-University Education and the Supreme Council of Universities separately signing off later that month. A survey of private schools last October found 100% of students had chosen the baccalaureate, with Allam calling Thanaweya Amma’s decline “inevitable” at the time. Private and international universities have also seen increased applications from students who did not receive their desired grades from Thanaweya Amma; one university head said his school received 900 applications within two hours of the Thanaweya Amma results being announced.

But some are still skeptical: In one Facebook thread for incoming students, replies topped 40, most sticking with Thanaweya Amma. One argued there’s no clear “best” system between the two, criticizing the baccalaureate for an unclear curriculum this close to the school year and predicting harder university-admission coordination under a newer, less-tested system. Another described feeling “forced” into the baccalaureate track. These posts are anecdotal and unverified — the group is private and its name withheld for privacy — but they’re a small signal that public sentiment may not completely align with official numbers.

The commercial question no one has answered: Whether a two-year, multi-retake system nets out to less tutoring spending overall or simply stretches the same spending across two years instead of one remains unresolved. Egypt’s private tutoring market was valued at roughly USD 0.78 bn in 2024 and is projected to nearly triple to USD 1.75 bn by 2033, per a January 2026 Deep Market Insights report — a private-sector estimate, not a government figure, set before this reform had time to bite.

OUR TAKE- Adoption numbers are the easy victory; governments always have those. The harder number is the one nobody’s produced: actual tutoring spending from before and after the reform took place. Until that shows up, the near-universal opt-in tells us families have chosen a track, but it doesn’t tell us that the track has delivered what it promised. Allam’s prediction that Thanaweya Amma is in its last year assumes the new system has delivered on those promises, but its true life expectancy will depend on the data.

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CALENDAR

AUGUST

19 August (Wednesday): Connected Banking Summit, Fairmont Nile City Hotel Cairo.

20 August (Thursday): Monetary Policy Committee’s fifth meeting of 2026.

26 August (Wednesday): Prophet Muhammad’s birthday.

SEPTEMBER

8-10 September (Tuesday-Thursday) El Alamein International Airshow, El Alamein International Airport.

10-12 September (Thursday-Saturday): Egyptian Entrepreneurship Sector Diagnostics Report Summit, El Gouna.

15 September (Tuesday): IMF to hold its eighth review of Egypt’s USD 8 bn EFF arrangement.

24 September (Thursday): Monetary Policy Committee’s sixth meeting of 2026.

27-29 September (Sunday-Tuesday): Global Conference on Population, Health, and Human Development.

28-29 September (Monday-Tuesday): Egypt Mining Forum, St. Regis Hotel New Capital.

30 September - October 3 (Wednesday-Saturday): Cityscape, Egypt International Exhibition Center, Cairo.

OCTOBER

5 October (Monday): The EnterpriseAM Egypt Forum.

6 October (Tuesday): Armed Forces Day.

10-11 October (Saturday-Sunday): Egypt Women’s Health Summit (EWHS), Cairo Marriott Hotel.

26-28 October (Monday-Wednesday): IEX Egypt, Egypt International Exhibition Center, Cairo.

29 October (Thursday): Monetary Policy Committee’s seventh meeting of 2026.

NOVEMBER

6-8 November (Friday-Sunday) : Global Entrepreneurship Festival, JW Marriott Hotel, New Cairo.

8-11 November (Sunday-Wednesday): Cairo ICT Forum.

DECEMBER

7-10 December (Monday-Thursday): Food Africa, Egypt International Exhibition Center, Cairo.

17 December (Thursday): Monetary Policy Committee’s eighth meeting of 2026.

EVENTS WITH NO SET DATE

Mid-August: IMF Board expected to decide on the seventh review of the loan program.

2H 2026: Operations at Deli Glass Co’s new USD 70 mn glassware factory kick off.

2026: The Egyptian-American Economic Forum.

4Q 2026: Banque du Caire IPO.

2027

20 January-7 February: Egypt to host the African Games.

1-3 February (Monday-Wednesday): Agri Expo, Cairo International Convention Center.

April 2027: Tenth of Ramadan dry port and logistics hub to begin operations.

EVENTS WITH NO SET DATE

2027: Egypt to host EBRD’s annual meetings.

2027: Egypt-EU Summit 2027.

End of 2027: Trial operations at the Dabaa nuclear power plant expected to take place.

September 2028: First unit of the Dabaa nuclear power plant begins operations.

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