{"id":551324,"date":"2022-06-09T13:19:35","date_gmt":"2022-06-09T13:19:35","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2022\/06\/09\/this-evening-cira-confirms-its-future-flow-securitization-plans-savola-closes-ole-bankery-acquisition-plus-inflation-accelerated-again-in-may\/"},"modified":"2022-06-09T13:19:35","modified_gmt":"2022-06-09T13:19:35","slug":"this-evening-cira-confirms-its-future-flow-securitization-plans-savola-closes-ole-bankery-acquisition-plus-inflation-accelerated-again-in-may","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2022\/06\/09\/this-evening-cira-confirms-its-future-flow-securitization-plans-savola-closes-ole-bankery-acquisition-plus-inflation-accelerated-again-in-may\/","title":{"rendered":"THIS EVENING: CIRA confirms its future flow securitization plans + Savola closes Ole Bankery acquisition. Plus: Inflation accelerated again in May"},"content":{"rendered":"

Good afternoon, wonderful people.<\/strong> Pat yourselves on the back for making it through this week, which is going out with a bang with a rather busy Thursday afternoon news flow.<\/p>\n

THE BIG STORIES TODAY<\/strong><\/p>\n

<\/a> #1- Annual urban inflation accelerated to 13.5% in May<\/strong>, as rising global commodity prices and the recent EGP devaluation pushed consumer prices upwards for the sixth consecutive month. Annual urban inflation accelerated from 13.1% in April, according tofigures (pdf)<\/a> released today by statistics agency Capmas. While this is the highest level since May 2019, it falls short of analyst forecasts<\/a> of a 14.2% median inflation rate.<\/p>\n

#2- We\u2019re getting closer to our first ever future flow issuance:<\/strong> EGX-listed private sector education outfit CIRA will issue EGP 2 bn worth of future flow securitized bonds over three years, the company confirmed in a statement to the EGX (pdf)<\/a> this morning. The first issuance will be worth EGP 800 mn, with the bonds sold at EGP 100 a pop, the statement notes. The EGP 2 bn program will cover CIRA\u2019s debt needs for the coming three years, funding its expansion plans for new universities and K-12 schools, CIRA CEO Mohamed El Kalla tells Enterprise. \u201cThis first future flow issuance is a really important step, and a reflection of how education is being seen more and more as a key industry in the country,\u201d adds El Kalla.<\/p>\n

Want a refresher on how exactly future flow securitization works?<\/strong> We\u2019ve got you covered<\/a>.<\/p>\n

#3- Savola closes acquisition of Ole bakery:<\/strong> Saudi food conglomerate Savola has signed the EGP 622.40 mn asset purchase agreement to acquire 100% of the Egyptian Belgian Company, which is best known for its Ole-branded baked goods, according to a statement (pdf)<\/a>. \u201cThe transaction included the acquisition of all tangible and intangible assets of the Egyptian Belgian Company,\u201d the statement reads. Al Ahly Pharos was exclusive buy-side advisor to Savola on the acquisition.<\/p>\n

<\/a> THE BIG STORY ABROAD-<\/strong><\/p>\n

The European Central Bank (ECB) left interest rates on hold at its monetary policy <\/strong>meeting today, but plans to raise rates in July and September<\/strong>, the bank said in a statement<\/a> today. The ECB expects to enact a 25 bps hike when it next meets on 21 July and expects to raise rates again in September. The exact increment \u201cwill depend on the updated medium-term inflation outlook,\u201d the ECB said, noting that a persistent or deteriorating inflation outlook would mean \u201ca larger increment will be appropriate.\u201d Interest rates in the eurozone are currently at -0.5%.<\/p>\n

The ECB is also winding down its asset purchase program as of 1 July<\/strong> and \u201cintends to continue reinvesting, in full, the principal payments from maturing securities purchased under the APP for an extended period of time past the date when it starts raising the key ECB interest rates.\u201d<\/p>\n

Market reaction:<\/strong> The ECB\u2019s plans to raise interest rates drove down European equities and spurred a sell-off in eurozone sovereign bonds, but analysts say that the markets had already expected monetary tightening to be the order of the day, according to the Financial Times<\/a>.<\/p>\n

T<\/strong>he Fed is coming up next: <\/strong>The US Federal Reserve is \u201call but certain\u201d to hike interest rates by another 50 bps when it meets next week, Bloomberg<\/a> writes, continuing the tightening cycle that the central bank embarked on<\/a> in May with a 50-bps hike (its biggest since 2000).<\/p>\n

The Central Bank of Egypt holds its policy meeting<\/strong> on Thursday, 23 June.<\/p>\n

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The situation with Ukraine\u2019s grain exports is also still getting plenty of attention this<\/strong> afternoon<\/strong>, as Kremlin spokesperson Dmitry Peskov told reporters that there is still no agreement between Russia, Ukraine, and Turkey on a way to resume wheat exports through Ukrainian ports, according to Reuters<\/a>.<\/p>\n

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** CATCH UP QUICK<\/strong> on the top stories from today\u2019s EnterpriseAM<\/strong>:<\/p>\n