UAE’s ADQ, ADNEC Group to acquire 40.5% stake in Egyptian hospitality company

Abu Dhabi’s ADQ, and ADNEC Group have signed definitive agreements to acquire a 40.5 per cent stake in Egypt-based Talaat Moustafa Group Holding’s hospitality arm, ICON Group through a capital increase.

ADQ and ADNEC will invest through a special purpose vehicle, with 49 per cent equity ownership by ADQ and 51 per cent equity ownership by ADNEC.

Humaid Matar Al Dhaheri, managing director and group CEO of ADNEC Group, said: “The investment in ICON is an important strategic step for ADNEC Group, as we deliver on our global expansion strategy and will provide ADNEC Group and its portfolio companies with access to Egypt’s rapidly growing tourism market and reaffirms our commitment to enhance our hospitality and tourism platform.

“We will work closely with TMG Holding to enhance and grow ICON and create additional value for our shareholders.”

Egypt’s leading hospitality company

ICON has built and owns some of the top luxury hotels in Egypt.

The group owns the Four Seasons Cairo at Nile Plaza, Kempinski Nile Hotel Cairo, Four Seasons Sharm El Sheikh and Four Seasons Alexandria at San Stefano.

It has three hotels and luxury residential real estate assets currently under development, such as the Four Seasons in Madinaty and Luxor and Radisson Collection in Marsa Alam, and one hotel under design, the Four Seasons at The Pyramids.

The transaction represents a major foreign direct investment in Egypt.

Hisham Talaat Moustafa, CEO and managing director of TMG Holding, said: “Through this partnership we will pursue substantial growth opportunities in Egypt’s tourism sector and beyond and will unlock further value for our shareholders.”

Plans after ADQ-ADNEC acquisition

The investment by ADQ and ADNEC in TMG’s hospitality arm will be used partially to deleverage the existing debt of ICON, with the remaining used for the acquisition of a stake through ICON in the portfolio of seven luxury heritage hotels owned by the Egyptian government, for which definitive agreements have been signed.

The hotels include Marriott Cairo Omar Khayyam Zamalek, Marriott MENA House Cairo, Sofitel Winter Palace Luxor, Sofitel Legend Old Cataract Aswan, Steigenberger Cecil Hotel Alexandria, Steigenberger Hotel El Tahrir Cairo and Mövenpick Resort Aswan.

Following this, ICON will have a combined portfolio of 15 luxury and upscale hospitality assets with a total of around 5,000 keys in prime locations, including Cairo, Luxor, Aswan, Sharm El Sheikh and Alexandria.

With tourism high on the agenda of the Egyptian government, the sector is anticipated to grow to more than 30 million tourists annually by 2028.

EFG Hermes is acting as the sole financial advisor to TMG Holding on the transaction.

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