Cairo – January 14, 2024: Talaat Mostafa Group’s hospitality arm, ICON, sold 40.5 percent of its stake to Abu Dhabi’s wealth fund (ADQ) and its subsidiary ADNEC Group over the weekend through a capital increase, however, the company did not disclose the transaction’s value.
The acquisition enables the UAE to have partial ownership of some of Egypt’s historical hotels.
According to a statement by ADQ, the transaction represents a significant foreign direct investment (FDI) in the North African country, signaling “a strong vote of investor confidence in the Egyptian tourism and hospitality sector”.
ADQ and ADNEC will invest through a special purpose vehicle, with 49 percent equity ownership by ADQ and 51 percent by ADNEC.
In December, TMG’s ICON acquired 39 percent of Legacy Hotels via the state’s privatization program, with a potential increase to 51 percent in an unspecified period, providing the hospitality arm with control over some of the country’s most iconic hotels.
The hotel acquisition included the Cairo Marriott Hotel in Zamalek, Marriott Mena House, Steigenberger Hotel El Tahrir Cairo, Steigenberger Cecil Alexandria, Sofitel Legend Old Cataract Aswan, Mövenpick Aswan, and Sofitel Winter Palace Luxor, with additional properties in Cairo, Luxor and Marsa Alam.
Some of the undisclosed investment will be directed towards partially deleveraging ICON’s existing debt, while the remaining investment will pay for TMG’s acquisition of Legacy Hotels.
Hisham Talaat Moustafa, CEO and Managing Director of TMG Holding, stated “We are delighted to have ADQ and ADNEC join us as strategic partners and shareholders in this landmark transaction and provide for an exciting outlook going forward. Through this partnership we will pursue substantial growth opportunities in Egypt’s tourism sector and beyond and will unlock further value for our shareholders”.
TMG recorded real estate sales of $3 billion (LE 93.1 billion) during the first 9 months of 2023.
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