Ahmed Heikal & Hisham El-Khazindar

Citadel Capital said it has partially exited ASEC Holding as well as United Foundries by selling off its six per cent stake in each of the companies to the Emirates International Investment Company (EIIC) in a $55 million deal.

A leading private equity firm in the Middle East and Africa with $8.3 billion in investments under control, Citadel Capital said the transaction set a new valuation benchmark for one of its key platform companies.

'The company sold a six per cent stake in ASEC Holding and a further six per cent in United Foundries, which was recently spun-off from ASEC Holding to the EIIC,' said Citadel Capital chairman and founder Ahmed Heikal.

EIIC, a leading regional investor based in Abu Dhabi, is a long-time limited partner in a number of Citadel Capital’s OSFs and is a Citadel Capital shareholder.

“This move comes in light of the firm’s strategic decision to further diversify its already-broad investment footprint to include new sectors such as solid waste management, where we recently finalised the acquisition of two companies that have become the nucleus of our eighteenth platform company,” Heikal noted.

“As we gently re-balance our investment allocation, it made sense to execute a partial exit of one of our most important platform companies in a way that establishes a clear valuation,” he remarked.

The deal values ASEC Holding at EGP 28.50 per share, which Citadel Capital managing director and co-founder Hisham El-Khazindar said 'was a very fair valuation that reflected the strong growth potential in ASEC Holding as it continues to expand its regional network of cement plants as well as its engineering and construction operations across the MEA.'

ASEC Holding controls portfolio companies including ASEC Cement, ASEC Engineering, ASEC Automation, Aresco and Esaco.

“This transaction reduces Citadel Capital’s holding in both ASEC Holding and United Foundries to 49 per cent from 55 per cent,” El-Khazindar added.

'Going below the 50 per cent threshold will allow us to treat both companies as associates and not subsidiaries. This will become an important distinction for our shareholders starting with the release of our fourth quarter results.'

'This move leaves Citadel Capital and its limited partners in full control of both ASEC Holding and United Foundries, but will allow us to show Citadel Capital shareholders a clearer picture of our firm’s financials over time,” El-Khazindar stated.

After the acquisition, EIIC will hold 10.25 per cent of ASEC Holding and 10.25 per cent of United Foundries.-TradeArabia News Service