We have a long run of investment and M&A news to get things moving this morning.

INVESTMENT WATCH- Half of the “ABCD” commodity giants are in bed together in Egypt as Archer Daniels Midland (ADM) partners with Cargill to run the latter’s soy crushing facility in Borg El Arab, the companies said in a joint press release on Monday. The pair will set up a joint venture that would own and operate the inventively named National Vegetable Oil Company soy crush facility along with related commercial and functional activities, including a separate Switzerland-based merchandising operation that would supply soybeans to the crush plant.

“Egypt is an important market where demand for high-quality soybean meal and oil is outpacing the rest of the world,” said John Grossmann, ADM’s president for EMEA oilseeds crush. The agreement, which is not yet complete, is subject to regulatory review, said the statement.

Sound smart: Cargill had announced back in 2015 that it was investing USD 100 mn to double crushing capacity at the facility to 6,000 tonnes and construct an additional 42,000-tonne storage facility. The company said last September that it was investing USD 150 mn “over the coming period” without naming the project. The companies hope to formally launch the joint venture in mid-2018.

Plenty of media coverage: The story is receiving widespread international coverage, including from Reuters and the Financial Times.

Advisors: Matouk Bassiouny served as local legal counsel to Cargill on the agreement, while Freshfields Bruckhaus Deringer was international counsel to the company.

INVESTMENT WATCH- Our friends at Egyptian Kuwait Holdings (EKH) could invest USD 110 mn this year in developing five natural gas wells in North Sinai, the company said in a bourse statement (pdf). Four of the wells the company is studying this year will be in the Camus gas field, and one in the Tao field, the company added. The investment will be through subsidiary NSCO Investments Limited, in which EKH acquired a 99.99% stake last week. The company announced that NSCO had completed development of two wells in the Tao field recently.

INVESTMENT WATCH- Is this Evergrow / EcoPhos in an EGP 8 bn fertilizers JV? Two unnamed Egyptian and Belgian companies have formed a JV to establish a new EGP 8 bn fertilizer factory, Al Mal reports, citing unnamed sources. Under the agreement, the Egyptian partner would hold a 51% stake in the JV, while the Belgian side will be responsible for providing 50% of the financing. The remaining 50% will be funded through domestic borrowing. The facility, which will tap into phosphate reserves at Abu Tartur, is expected to produce 500k tonnes of fertilizer once it is fully operational in seven years’ time. According to the sources, the facility will export 100% of its output.

Our take: The sources refused to disclose the names of the investors, but the details of the project found awfully close to those of the phosphate production complex Evergrow had announced it would build with two foreign partners. Evergrow was in talks with a consortium made up of Borealis and EcoPhos — the latter of which is Belgian — to take the project forward.

M&A WATCH- A consortium made up of Ebtikar for Financial Investment Company, our friends at TCV and Acquire has submitted an offer to acquire 100% of Orascom Development Egypt’s (ODE) stake in Tamweel Group, according to a statement (pdf) from MM Group for Industry and International Trading (MTI), which holds a 50% stake in Ebtikar. The consortium is said to be offering EGP 300 mn, “10% of which is variable depending on the performance of Tamweel in 2018,” read the release. The sale of Tamweel, which operates leasing, mortgage finance, factoring and insurance brokerage units, was part of ODE’s sale of non-core assets to reduce its debt burden by EGP 1 bn. The transaction is awaiting board approvals on both sides and will need sign-off from the Financial Regulatory Authority.

Advisors: Zaki Hashem & Partners advised Ebtikar and TCV on the transaction, while Taha, Moussa & Sabahi Law Firm represented Acquire.

In other ODE news: A new development at Makadi? As for ODE’s plans at Makadi, the company appears to be considering developing another residential project in the area after announcing on Sunday a sale of Makadi Gardens, IR Director Sara El Gawahergy tells Al Borsa. The project could be potentially worth EGP 200 mn in sales, she added. She also stated that the company was considering taking on another hotel in Gouna.

M&A WATCH- The Saudi-Egyptian Industrial Investment Company (SEII) is earmarking USD 50 mn to fund acquisitions over the next two years, CEO Ahmed Ata tells Al Mal. The company is currently in talks to acquire majority stakes in two companies in the food and textiles sectors and expects to complete the transactions during 1H2018, according to Ata.

M&A WATCH- Nahw Development (completely new to us, folks) has completed a mandatory tender to acquire the remaining 49% stake in Cairo Development Investment Company (CDICO), which it launched last month, Al Borsa reports.Nahw bought13.59 mn shares at EGP 4.61 per share, pricing the transaction at EGP 57.5 mn. CDICO had appointed Osool to advise on the transaction and conduct a fair value assessment.

Israel denies it is making concessions on the int’l gas arbitration award against Egypt—have the two sides agreed just to gloss over it? Senior Israeli officials have denied that last week’s pact to export USD 15 bn worth of natural gas to Egypt included an agreement to squash a USD 1.76 bn international arbitration from a pre-revolution contract to sell natural gas o Israel, Haaretz reports. “Israel hasn’t given up on the debt and the matter did not come up for discussion during talks on the Leviathan export deal to Egypt that was signed [last] week,” Israel’s Ministry of Energy said. Israel Electric Corporation, the beneficiary of the 2015 arbitration award, also denied that such a concession was made. “The company is not aware of any concessions on the debt. There won’t be any backing down on the debt. The company continues to seek to collect it,” IEC said in a statement. As we noted on Sunday, the Prime Minister Sherif Ismail seemed to suggest that the agreement, which would see Alaa Arafa’s Dolphinus Holding import gas from Israel’s Delek and Noble, part of a compromise to withdraw the USD 1.76 bn international arbitration ruling against EGAS, EGPC and East Mediterranean Gas (EMG). Ismail had made dropping the arbitration award a condition to allowing imports of gas from Israel’s Leviathan field.

Maybe the arbitration isn’t really that important to Israel? A senior Israeli government source, who asked not to be identified, told Haaretz’s TheMarker that he didn’t expect Egypt would agree to pay the debt and that Egypt’s failure to pay the compensation wouldn’t affect electricity rates in Israel since IEC had already written off the debt as unrecoverable and had incorporated it into rates over the last six years. That, coupled with the fanfare from the announcement of the agreement, would hint that formal settlement of the issue may not be as essential as both governments are letting on.

LEGISLATION WATCH- Council of State reviewing Healthcare Act regs before they’re sent to Cabinet: The Health Ministry has sent the executive regulations to the Universal Healthcare Act to the Council of State (Maglis Al Dawla) for review before they are sent to the Ismail Cabinet to be issued, Alaa Ghanam, a member of the ministry’s healthcare act committee, tells Youm7. Cabinet was due to receive the regs before the end of last week, according to previous statements by Health Minister Ahmed Rady, who also said that “national dialogue” sessions would be held next month to discuss the pricing of medical services offered under act.

Three new regulators in the making: The committee will be meeting in mid-March to establish the three new authorities that will oversee the new healthcare system once implementation starts in July, beginning with Canal cities. President Abdel Fattah El Sisi had signed the Universal Healthcare Act into law in January. Tap or click here for a refresher.

Housing Ministry rolls out ambitious EGP 32 bn Sinai development strategy: The Housing Ministry has completed mapping out a EGP 32 bn development strategy for Sinai, Al Mal reports. The strategy relies heavily on new incentives to attract investors to do business in the peninsula, which the ministry hopes would spur urbanization and population growth. The strategy includes establishing a new economic center in North Sinai and converting the governorate’s capital city to a freezone. The ministry also plans to establish a commercial port on the Mediterranean, and several specialized industrial zones that would capitalize on Sinai’s resources, including its mineral wealth.

The strategy sees tourism as playing a key role in the peninsula’s development, and focuses specifically on promoting religious tourism to The Holy Family Trail and recreational tourism to beach resorts by improving infrastructure and constructing new hotels. A new airport would also be constructed in North Sinai to facilitate tourist arrivals to the area. Incentives to drive population growth include constructing housing projects; establishing new schools, research centers and hospitals. Arab News also has the story.

Nearly 750k Ukrainian tourists visited Egypt in 2017, a 90% y-o-y jump, Tourism Promotion Authority (TPA) head Hisham El Demery told the press yesterday, according to Al Masry Al Youm. In response to the surging demand, Ukraine International Airlines announced they would operate four weekly flights between Cairo and Kievas of 6 April, Al Shorouk reports. The surge, along with a 66.5% y-o-y rise in group travel to Egypt in 2017, comes as the country’s ailing tourism sector continues to recover.

Sound smart: Ask your friends in the tourism industry how many of those Ukrainian tourists were actually Russians coming in through the back door in the absence of direct flights to Egypt from Mother Russia.

Russia plays the blame game on delay in resumption of direct flights: The resumption of civilian air traffic to Egypt from Russia has been delayed because air carriers have not reached an agreement on their ground handling, Russian Transport Minister Maxim Sokolov said on Monday, according to Reuters which cites RIA news agency. EgyptAir Chairman Safwat Musallam had said that flights between the carrier and Russian airline Aeroflot had been postponed until April to ensure significant demand. It had been hoped that flights with Russia would begin about two weeks ago. Sokolov also said that Russia and Egypt could restart talks on resuming flights with Red Sea destinations such as Sharm El Sheikh and Hurghada in the spring after Moscow-Cairo flights had been restarted.

That’s not stopping them from crowing about the Dabaa nuclear power plant. Rosatom, the Russian company building the USD 30 bn plant, has put out yet another press release telling us how great the plant will be for the economy.

EARNINGS WATCH- Edita Food Industries reported a 346.8% y-o-y surge in its bottom line to EGP 212.0 mn in 2017, up from EGP 47.4 mn in 2016, the company said in a statement yesterday (pdf). The jump in net profits comes as the company’s revenues for the year rose 21.6% y-o-y to surpass the EGP 3 bn mark in 2016. “The results speak for themselves, with double-digit revenue growth and healthy margins despite operating in an extremely inflationary environment characterized by diminishing consumer purchasing power,” Edita chief Hani Berzi said. After launching several new products last year and inaugurating its state-of-the-art E08 factory with new production lines, the company plans to focus during the coming period “on driving up volumes while also maintaining an emphasis on margin and cost-cutting initiatives.” Read Edita’s full earnings release here (pdf).

Madinet Nasr Housing and Development posted a net profit after tax of EGP 933.1 mn in FY2017, according to the company’s earnings release (pdf). Top line for the year was 20.5% higher y-o-y at EGP 2.43 bn, rising on the back of a 48.9% y-o-y growth in presales to EGP 5.1 bn. The company pushed forward with the third phase of its Taj City project in 4Q2017, which has boasted “consistent generation of solid sales.” Meanwhile, Sarai reeled in EGP 4.2 bn in contracted sales throughout the year. “During a year of economic reforms and uncertainty in Egypt, MNHD has continued to record exceptional year-on-year growth in both our top-line and bottom-line, surpassing our budget and underlining our ability to achieve significant gains and execute successful launches regardless of the surrounding climate,” CEO Ahmed El Hitamy said.

Palm Hills Development reported a 26% y-o-y rise in net profit after tax and minority interest to EGP 806 mn in FY2017 from EGP 640 mn in FY2016, the company said in a statement (pdf). The increase came “despite the negative impact of higher finance cost y-o-y.” Revenues grew 17% y-o-y to EGP 6.604 bn, up from EGP 5.361 bn during the previous year. New sales for the year also rose 24% y-o-y to EGP 10.539 bn, surpassing the company’s target for the year.

Emaar Misr for Development reported a 37% y-o-y jump in net profit to EGP 2.3 bn in 2017, compared to EGP 1.68 bn the previous year, according to the company’s earnings release (pdf). The developer’s total revenues jumped to EGP 4.5 bn from EGP 4 bn in 2016.

MOVES- Shehab Mazhar has stepped down as Palm Hills Developments’ (PHD) the company’s board of directors after a 20-year run with the company, which he co-founded, according to an emailed company statement (pdf). Mazhar will continue to provide service to PHD through his private office, Shehab Mazhar Architects.

Egypt was home to 221,675 registered refugees as of 22 January 2018, according to UNHCR statistics (pdf). Syrians represent around 57% of that number (127,414), while Sudanese asylum-seekers makeup around 16% (26,195). Ethiopian and Eritrean refugees makeup 7% and 6% of the total, respectively, while South Sudanese represent 5%. Other nationalities include Iraqi and Somalis.