Egypt Launches “Pre-IPO” Fund for Businesses Aiming to go Public

Egypt Launches “Pre-IPO” Fund for Businesses Aiming to go Public

Egypt is launching a new “pre-IPO” fund to provide financial support to businesses in their quest to get listed on the Egyptian stock exchange. This was revealed by the Minister of Planning and Economic Development, Hala Elsaid in a TV interview with Bloomberg on Tuesday.

The pre-IPO fund, which El-Said noted was established on Monday, aims to acquire public stakes in a number of public institutions to attract more investment; it will also work with strategic investors including sovereign wealth funds ahead of public offerings.

Pre-IPO is an abbreviation for “pre-initial public offering.” This is the stage at which founders sell shares in their tech startup before it is listed on a public exchange. Investing in a startup during its early stages allows its founders to secure sufficient funding to launch and scale smoothly.

Elsaid, who is also the Chair of Egypt’s Sovereign Wealth Fund, stated that the government is working to increase Egypt’s foreign exchange receipts by increasing exports, FDI, and remittances from abroad and that the government currently favors a flexible exchange rate.

During her interview, El-Said stated that Egypt is focusing on privatization and the development of a private-sector-led economy.

Egypt had announced that it was preparing to relaunch its initial public offering program, intending to list around 10 government and military-owned companies on the Egyptian Exchange by the end of the year, a plan that had been delayed due to the Russia/Ukraine conflict.

The Public Investment Fund of Saudi Arabia (PIF) established the Saudi Egyptian Investment Company (SEIC) in early August, with the primary mission of making investments in a variety of Egypt’s economic fields. Almost immediately after its formation, the SEIC acquired minority stakes in four Egyptian companies worth more than $1.3 billion.