In Egypt’s first management buy out, CDC Capital Partners is backing local management in the US$20m purchase of a sesame food business, El-Rashidi El-Mizan. It is private equity investor CDC’s first deal in the country since opening its Cairo office in Spring 2001.
El-Rashidi El-Mizan, a 113-year old Egyptian family business, is being sold by Unilever, for whom the company’s products do not form part of its ‘Path to Growth’ strategy for the region. The company’s management team will have a stake in the business, with CDC as majority shareholders, while the remainder will be held by the Rashidi family and other shareholders.
El-Rashidi El-Mizan is the market leader in the production of the Egyptian staple foods, Halawa and Tahina. Both are made from sesame seed, with Tahina being a savoury food while Halawa is sweetened and is an important energy source for Egyptians.
Mohamed El-Rashidi, Chief Executive of El-Rashidi El-Mizan said: "We think CDC will be a valuable investment partner for us. Not only do they have expertise in these types of transaction they also have an extensive international network, which we think can add value to our business. This partnership marks the beginning of a new phase of growth for El-Rashidi El-Mizan."
CDC’s Representative in Egypt, Hywel Rees Jones, said: “This MBO is the kind of transaction CDC has been targeting in Egypt. It underlines CDC’s strategy in Africa of backing successful, existing businesses with talented management and strong business plans.”
Like Unilever, CDC applies a rigorous set of standards to its activities with respect to environmental, social, health and safety responsibility. CDC will look to maintain best practice at El-Rashidi El-Mizan as part of its own investment ‘Business Principles.’
Sigma Capital were the Cairo-based advisors for this transaction.