Saudi fund eyes stake in real estate firm led by Egyptian billionaire

The Saudi Public Investment Fund (PIF) is presently engaged in negotiations with the Arab African International Bank to purchase a 13-percent stake in Palm Hills Development, a prominent Cairo-based real estate firm led by Egyptian billionaire Yasseen Mansour.

Palm Hills Development ranks as the second-largest real estate company listed on the Egyptian Exchange. The recent move by PIF to increase its holdings in the group follows the impressive financial performance of Palm Hills Development under Mansour.

In the first half of 2023, the company reported consolidated net profits after tax amounting to EGP638.82 million ($20.67), a notable increase compared to the EGP561.79 million ($18.18) recorded in the corresponding period in 2022.

Sources with knowledge of the matter have confirmed that discussions regarding PIF’s acquisition of a 13 percent stake in Palm Hills Development from the Arab African International Bank commenced approximately a month ago.

The final pricing details are now being ironed out. Notably, the transaction will be conducted in U.S. dollars, in line with the valuation of the bank’s stake in the company. It is anticipated that the deal will be concluded before the end of the year.

Palm Hills Development, an operational subsidiary of Egypt’s largest conglomerate, the Mansour Group, enjoys a strong reputation as a leading real estate developer with active investments throughout Egypt. The company specializes in the development of integrated residential, commercial, and resort communities.

Palm Hills Development is majority-owned by the Al-Mansour and Maghraby Investment and Development Group, which holds 41.9 percent of the company’s shares. Additionally, Mansour retains a 7.29-percent ownership stake.

This potential acquisition by the Saudi Public Investment Fund signifies a strategic move within the real estate sector, underlining the attractiveness of Egypt’s burgeoning property market. Stakeholders are keenly watching the developments of this negotiation as it has the potential to reshape the ownership landscape of one of Egypt’s key real estate players.