Fund Overview. November, 2016

Transcription

1 Fund Overview November,

2 Egyptian-American Enterprise Fund At a Glance Inspired by the Enterprise Fund model successfully developed by the United Sates Government (USG) Oversight by a Robust, Diversified Board of Directors and Investment Committee Managed by an on the ground team with local insight & access to information US$ 300 million in seed capital as authorized by US Congress Partnering with international and local players in seeding new local funds. USD 1.2 bn +75 years Lorax Capital Partners +USD 77mn USD 20 mn In direct investment by USG in Enterprise Funds in 19 countries Of combined emerging markets experience across EAEF s Board of Directors Appointed as EAEF s investment advisor and asset manager Invested in assets across various industries including consumer finance, healthcare and financial technology In seed funding for local funds including Algebra Ventures and Tanmiyah Investment Partners Fund Objective The EAEF s mandate is to invest in private enterprises in Egypt contributing to long term inclusive and sustainable economic growth. EAEF deploys capital on a profit seeking basis with the aim of creating job, improving quality of life, promoting financial inclusion and attracting foreign investors to the Egyptian market. Investment Criteria The EAEF s investment criteria is to target investee companies who meet EAEF s objectives and that are in need of growth capital or capital to restructure operations. Investee companies must maintain Egypt as their primary country of operation and hold solid expectations of profitability. 2

3 EAEF Timeline & Milestones Frmr. Sec. Clinton champions an initiative to establish the Egyptian-American Enterprise Fund to help restore the Egyptian economy President Obama receives authorization from Congress to create EAEF as a private corporation seeded with $300mn. EAEF Grant Agreement is Signed by Secretary Kerry EAEF leads a consortium of int l investors to finance the 1 st & biggest exit of a Fin. Tech. company: Fawry for $100 mn, including EAEF s investment of $20 mn EAEF makes its first investment in Early Stage companies by investing $1.2 mn in the tech-healthcare startup Smart Care EAEF takes strategic initiative & launches a Parallel Fund to Invest in private enterprises in Egypt and further its contribution to long term inclusive and sustainable economic growth May 2012 Jun 2015 Nov 2015 Jul 2016 Sep 2016 May 2011 Mar 2013 Jul 2015 May 2016 Aug 2016 James A. Harmon is appointed Chairman of EAEF EAEF board selects Lorax Capital Partners as its investment advisor and asset manager EAEF acquires majority stake in the leading consumer finance company, Sarwa Capital. The investment included a $20 mn capital injection EAEF announces its $10mn seed investment in an SMEfocused Fund Tanmiyah Investment Partners EAEF reached financial close on its first investment in a Venture Capital Fund seeding the managers with $10 mn to launch Algebra Ventures 3

4 Strong Leadership & Governance Investment Committee Members* Board of Directors* James A. Harmon Hythem T. ElNazer Daniel Zelikow Chairman of EAEF Vice Chairman of EAEF Dr. Hani Sarie El-Din Tarek Abdel Meguid Hala El Mohandes Haydee Celaya Nadim El Gabbani Nada Shousha ** The team in the U.S. led by Jim Harmon supports pipeline companies by providing access to international resource, making introductions to similar platforms in the U.S. and encouraging transfer of knowledge James A. Harmon Investment Committee Member Hythem T. ElNazer Investment Committee Member Daniel Zelikow Investment Committee Member Nadim El Gabbani Investment Committee Member Amal Enan EAEF s Chief of Staff & Policy Director The team leverages their international investment experience, strong relationships with U.S. institutional investors and DFIs in selecting attractive investments and attracting more foreign capital into Egypt * Please refer to appendix I for Board of Directors bios ** EAEF Board Nominee, Subject to Election by the Board 4

5 On the Ground Management An asset manager with significant experience in institutionalizing businesses and preparing them for IPOs and/or exits. The Lorax Capital Partners Advantage: On the ground presence Local knowledge and wide network for sourcing Execution capacity Hands on portfolio management Preferred partner for international investors. Ashraf Zaki Founder & Managing Partner Founded Lorax Capital Partners (LCP) in Founded and managed Gaston Capital, a boutique investment in the MENA region. Previously served as a member of the Executive Committee & Co-Head of Investment Banking at EFG Hermes as well as Vice President at Morgan Stanley Investment Banking Mohamed Arafa Managing Partner Joined LCP as Managing Partner in March 2016 Was an independent financial advisor to and founder of Hegestone Capital specializing in corporate restructuring Previously served as Chief Financial Officer, Group Treasurer and Executive Committee member at EFG Hermes Amr Fikry Managing Partner Joined LCP as Managing Partner in March 2016 Prior to LCP Amr was a Managing Director at EFG Hermes Investment Banking. Executed M&A, Equity and Debt transactions worth USD 32.5 billion Sherif Salem Vice President Oversaw EAEF s minority stake acquisition of Fawry Served as Senior Associate at Gaston Capital where he worked on various transactions across several industries, including manufacturing, retail, F&B and infrastructure among others. Is a CFA Charterholder Mohamed Sadek Vice President Oversaw EAEF s acquisition of a majority stake in Sarwa Capital Served as Senior Associate at Gaston Capital where he worked on various transactions across several industries, including manufacturing, retail, F&B and infrastructure among others. Garduated summa cum laude from the American University in Cairo 5

6 Investment Mandate Objectives Investment Criteria Strategy Contributing to long-term inclusive and sustainable economic growth in Egypt Job creation Improving quality of life Promoting financial inclusion Attracting new foreign investors to the market A need for growth capital or capital to restructure operations The primary country of operations of the investee companies is Egypt Investee companies must meet one or more of the above mentioned objectives Expectations for profitability of both the company and EAEF s investment in it EAEF will target opportunities where it can bring additional resources for the benefit of the investee. This includes additional public or private investors, technical assistance, management skills and industry knowledge EAEF will seek board representation in investee companies to add value EAEF will seek minority stakes in investee companies. Controlling stakes will be considered if necessary to achieve the benefits EAEF brings as a value adding shareholder to the investee EAEF will target competitive market terms but it retains the flexibility to forgo financial returns for positive social impact in order to achieve its dual bottom line EAEF does not intend to engage in competitive bidding and crowding out of other private investors prepared to finance an enterprise on reasonable terms, all other considerations being equal EAEF will seek geographic and sectoral diversification of its portfolio in Egypt based on assessments of development priorities, periodic monitoring and evaluation of the portfolio EAEF may appoint one or more investment management teams to identify and manage Fund investments. EAEF is a long term investment partner and will seek to partner with investors, managers and shareholders with objectives aligned to EAEF s mandate 6

7 What We Primarily Look For Consumer-Focused Sectors: Increasing the variety and quality of goods & services Infrastructure Development: Catalysts of sustainable economic growth Financial Services Logistics/Transportation Fast Moving Consumer Goods FMCGs Waste Management Retail and Consumer Services Healthcare Renewable Energy Education IT/Technology 7

8 Rigorous Investment Process Strategy Board defines mandate; Policy Director outlines development needs, strategy, and priority sectors Sourcing EAEF s Investment Advisors, Lorax Capital, source viable opportunities aligned with EAEF s strategy and prepares an initial analysis Screening EAEF s Investment Committee convenes monthly to examine pipeline companies ultimately achieving EAEF s dual bottom line Due Diligence Lorax Capital performs a comprehensive appraisal of target companies 4 Board Approval Upon completion of DD & negotiation of final terms, viable investment opportunities are presented for board approval 5 Portfolio Manageme nt Lorax Capital supervises portfolio companies 6 7 EAEF Long- Term Partner EAEF continues to engage with management to add value and support the companies growth 8

9 Investment Portfolio * $100 million total consortium s investment EAEF s Share of Investment :$20 million $20 million new capital injection $1.2 million investment 20% Stake - July 2015 Majority Stake - November % Stake - May 2016 Fawry was founded in 2009 as Egypt s first electronic payment network. Today it is the largest payment services company in Egypt with over 15 million customers Sarwa Capital is the largest independent consumer finance provider in Egypt targeting primarily the unbanked population in Egypt and is the first developed retail car insurance provider through Contact Cars SmartCare is a medical services company that offers corporate clients customized and discounted HMO (Health Management Organization) and TPA (Third Party Administration) plans for SMEs and individuals. SmartCare was selected in the Endeavor global international selection panel in Palo Alto California in 2013 and has joined the international network * As of June

10 Investment Portfolio Fawry Management Development Impact EAEF Added Value Ashraf Sabry Founder & CEO: Ashraf is the key driving force to create Fawry. Prior to joining Fawry, Ashraf was the vice chairman of Raya Group, and spent 10 years working at IBM Egypt. Ashraf holds an MBA from Leeds University in the United Kingdom Mohamed Okasha Managing Director: Mohamed has over 18 years of experience in corporate retail sales, marketing and operations management of both IT and telecom Industries. Before joining Fawry, he held top executive roles at Raya and Vodafone. Mohamed holds a BSC in Computer Science from AUC, and an International MBA from the graduate school of ESCLSCA Increase banks customer base and develops financial inclusion Reallocating activity in the cash economy to the real economy Growing consumer finance to stimulate domestic demand and economic growth Facilitating efficient cash management Enabling e-commerce and trade in Egypt Reducing government bureaucracy by simplifying utility and license payments and e-government services Bringing two other institutional investors to the consortium Nominating value adding board members to the company Introducing international best practice in the field of payments, mobile banking and microfinance to the company Supporting management in raising additional capital for the company s future growth 15 million customers 1.3 million transactions /day 65 different billing services EGP 5.8 billion in transactions value 50,000 service points 10

11 Investment Portfolio Sarwa Capital Management Hazem Moussa-Founder&Managing Director: Hazem chairs the board of Contact and drives the expansion of the business. Prior to Sarwa, Hazem was Manager at HSBC Investment Banking in Egypt Amr Lamei-Founder& Managing Director: Amr was responsible for setting up Contact s funding efforts and the company s issuance of securitization bonds. He has over 20 years of diverse banking experience. Prior to Sarwa, he was Deputy Managing Director at HSBC Investment Bank in Egypt Ayman el Sawy-Corporate Finance Director: Ayman has a long expertise in securitization and structured loans. He is responsible for funding and financial planning at Sarwa and manages all funding activities in addition to the financial aspects of business development EGP 1.4 billion Loans booked in ,000 clients Development Impact Extending credit to the non-banked population, approximately 50% of Sarwa s client base are first time entrants to the banking system Expanding the range of financial products in the Egyptian market: the company is growing beyond auto financing to consumer goods financing and financing club membership which has high social value Building on its track record, the company now provides securitization advisory services Negligible credit losses on 0.2% repossessions EGP 6.7 billion total financing EAEF Added Value Injecting capital in the company to expand the range of services Introducing the company to export-import agencies to establish credit facilities for on-lending to private businesses in Egypt Building relationships with equipment manufacturers and real estate developers Providing management with international best practice expertise Instituting corporate governance as the company grows EGP 780 million Active car insurance portfolio 11

12 Investment Portfolio Smart Care Management Amr El-Tayeb Founder: Amr has worked on the medical provider side for more than 17 years and has practiced both medicine and hospital management in both private and public sectors. He has been involved in advising both private and public sector healthcare development and legislations. Amr has an MSc in General Surgery and an MD in Neurosurgery (2004) from Cairo University and a fellowship from the Royal College of Surgeons of England 100 Corporate client 95% Client retention rate Development Impact Meeting the growing need for improved healthcare services in Egypt Significantly lower the cost of medical care for clients Improved patient experience Serving the uninsured; who constitute the majority of the population Empowering tech enabled platforms in Egypt to allow for scalability, accessibility and increased inclusion Access to over 400 healthcare provider 10,000 Total individuals served EAEF Added Value Injecting capital in the company to develop additional products tailored to address market needs EAEF is the first international investor in the company Expanding SmartCare s client base by creating synergies within EAEF s portfolio Encouraging the transfer of knowledge by building relationships between the founder and US-based innovative business models Support entrepreneurial talent to attract more investors to the ecosystem Access to care through a 24/7 call center 12

13 EAEF: Strategic Initiatives - Parallel Fund Capitalizing on EAEF s management, growing portfolio companies and success in building an attractive pipeline, EAEF is launching a Parallel Fund The Parallel Fund will invite private sector institutions and sovereign wealth funds to join EAEF s investments in the thriving Egyptian market Parallel Fund investors will get the opportunity to channel capital flows to a lucrative landscape of high return assets identified and executed by EAEF s fund managers The Parallel Fund will: Unlock real value in Egypt s private sector Increase the flows and sources of FDI to Egypt Leverage EAEF s local knowledge in sourcing and executing transactions Target significant returns in Egypt compared to other emerging markets 13

14 Appendix I: Board of Directors & Management Bios 14

15 EAEF - Board & Management Bios James A. Harmon Chairman & Investment Committee Member Hythem T. El-Nazer Vice Chairman & Investment Committee Member Daniel Zelikow Board & Investment Committee Member Dr. Hani Sarie El-Din Tarek Abdel-Meguid Mr. Harmon is the Founder and Chairman of the Caravel Fund, an emerging and frontier market fund, and the former Chairman, President and Chief Executive Officer of the Export-Import Bank of the United States from Ex-Im Bank assists in financing the export of US goods and services to international markets. Jim was appointed as EAEF Chairman in 2012 to establish EAEF. He brought his investment and emerging markets experience, nominated the board and selected the management team all of which made EAEF a reputable player in the Egyptian market today. In 2004, Mr. Harmon was elected Chairman of the Board of the World Resources Institute (WRI), a global policy and research institution. Prior to Ex-Im Bank Mr. Harmon was Chairman and CEO of the investment bank, Schroder Wertheim & Co. Managing Director, TA Associates, a global private equity firm with USD24 billion of investment capital and over four decades of investment experience. Global Head of JP Morgan s Public Sector Group, the former Executive VP and COO of the Intern-American Development Bank in Washington, DC and former US Treasury Deputy Assistant Secretary responsible for financial policy towards countries in the Americas, Asia and Africa. Founding Partner, Sarie-Eldin and Partners and former Chairman of the Egyptian Market Authority and board member of the Central Bank of Egypt. Founding Partner and Head of the Asset Management, Perella Weinberg Partners, where he oversees USD3.5 billion of assets under management; former Head of Worldwide Investment Banking at Morgan Stanley 15

16 EAEF - Board & Management Bios Hala-El Mohandes Haydee Celaya Deputy Vice-President of the Structured and Project Finance Division of the Export Import Bank of the United States. Co-founder of Avanz Capital where she is Chief Investment Officer. Previously, Haydee was head of the IFC s Private Equity and Investment Funds Group and Chairperson of the IFC Global Funds Investment Committee. Nadim El Gabbani Board & Investment Committee Member Nadim El Gabbani is a Managing Director in the Private Equity Group of Blackstone. Mr. El Gabbani currently focuses primarily on the FIG and Retail sectors Nada Shousha Board & Investment Committee Member Nada is the Former Country Manager for Egypt, Libya and Yemen at the IFC. Nada joined IFC in 2002 as an Investment Officer in the Financial Markets Department where she led a number of transactions in areas such as mortgage finance, factoring and banking across the MENA Region Amal Enan Chief of Staff, Policy Director and Secretary of the Board Amal Enan is the Chief of Staff and Director of Policy Planning for EAEF. Amal started her career at EFG-Hermes and continued to build her investment experience at the International Finance Corporation. In 2010 Amal joined the Ministry of Finance as an Economist in the Minister s Office. There, she formulated reform policies negotiated with international organizations on matters that address the nations most pressing challenges. Amal received an MBA degree from Harvard Business School, a Masters in Environment and Development from the London School of Economics and a Bachelors in Economics from Cairo University. Amal is a CFA Charter Holder. 16

17 Lorax Capital Partners - Management Bios Ashraf Zaki Founder & Managing Partner Mohamed Arafa Managing Partner Amr Fikry Managing Partner Sherif Salem Vice President Mohamed Sadek Vice President Ashraf founded Lorax Capital Partners ( LCP ) in Prior to LCP, Ashraf founded and managed Gaston Capital, a boutique investment in the MENA region. Previously, Ashraf was a member of the Executive Committee and Co-Head of Investment Banking at EFG Hermes where he oversaw a team of 25 professionals and executed more than USD6 billion of M&A transactions and USD6 billion of equity transactions. He serves as a board member of Sarwa Capital and Fawry. Ashraf worked as a VP at Morgan Stanley Investment Banking and as an Analyst at Bear, Stearns & Co. Inc. in New York. He graduated from Cairo University Faculty of Engineering in 1993 Mohamed joined the LCP team as Managing Partner in March Prior to joining LCP, Mohamed was an independent financial advisor and founder of Hedgestone Capital specializing in corporate restructuring and capital raising. He advised several clients across various industries. Mohamed held numerous positions at EFG Hermes, ultimately assuming the responsibilities of Chief Financial Officer, Group Treasurer and member of the Executive Committee. He played a leading role in raising capital and debt for all group companies, as well supporting fundraising for selective M&A transactions. Mohamed served and continues to serve as a board member of several blue chip corporations in Egypt and the MENA region Amr joined LCP as a Managing Partner In March Prior to LCP, Amr was a Managing Director at EFG Hermes Investment Banking and was the most senior member of the Egypt Investment Banking office who played an integral role in developing a department of 25 professionals. At EFG he worked closely with the group s CEO on the strategic initiatives for the group including taking the lead on the acquisition of a microenterprise services company and exiting the group s stake in a leading Lebanese commercial bank in a deal valued at about USD 490 million. He executed M&A, Equity and Debt transactions worth USD 32.5 billion Sherif was responsible for EAEF s minority stake acquisition of Fawry. Prior to LCP, Sherif was a Senior Associate at Gaston Capital. He worked on various transactions across several industries including, banking, industrial manufacturing, retail, F&B and infrastructure among others. Sherif graduated magna cum laude from the American University in Cairo (AUC) with a BBA in Finance and a BA in Economics. Sherif Salem is also a CFA Charterholder. Mohamed was responsible for EAEF s majority stake acquisition of Sarwa Capital. He currently sits on the Board of Directors of Sarwa Capital. Prior to LCP, Mohamed was a Senior Associate at Gaston Capital where he worked on various transactions across several industries including, banking, industrial manufacturing, retail, F&B and infrastructure among others. Mohamed graduated summa cum laude from the American University in Cairo (AUC) with a BBA in Finance. He spent a year abroad at University of California, Berkeley where he completed his finance coursework. 17

18 Thank You