الهيئة العامة للرقابة المالية

• For the first time in Egypt, listed companies are leveraging dividend distributions to broaden their ownership base, thereby facilitating listing and trading volumes.
• This innovative mechanism for listing and trading shares sidesteps the conventional routes of public or private offerings and even capital increases. It is a clear demonstration of how flexible regulatory frameworks are evolving, providing new tools to boost market’s efficiency and competitiveness.

FRA approves the disclosure report of U Consumer Finance (formerly Valu), a key subsidiary of EFG Holding Group. This move aligns with Article 7, Clause 2, Paragraph 2 of the Listing and Delisting Rules, which mandates that companies seeking to list must publish an FRA-approved disclosure report before trading commences, provided all listing conditions are met.

It is worth noting that these procedures represent an innovative legal method proposed by EFG Holding Group and approved by FRA in an unprecedented step. It is a groundbreaking approach that utilizes the dividend distribution mechanism of listed companies and their subsidiaries’ activities to broaden the ownership base and streamline listing. This effectively transforms indirect ownership into direct ownership, expanding the pool of direct shareholders in non-bank financial companies.

This innovative method simplifies listing and trading process, eliminating the need for traditional public or private offerings, or even a capital increase. It clearly demonstrates the flexibility of current regulatory frameworks and the continuous evolution of tools designed to attract new investors and deepen the market.

FRA acted swiftly, fast tracking the review, study and coordination with all involved parties to ensure the safety of shareholders’ rights and overall market stability.

U Consumer Finance has prepared the disclosure report, encompassing all the necessary technical, legal and financial details. With its publication, investors will have full access to this crucial information, empowering them to make well-informed investment decisions.

Notably, U Consumer Finance is the first consumer finance company to be listed on the Egyptian Exchange. This landmark step not only enhances the integration of non-bank financial activities but also paves the way for expanding the base of listed companies in this promising field.

FRA emphasizes that this move aligns with its strategy to boost listing and trading of non-bank financial companies. This aims to leverage the benefits of exchange listings, including enhanced disclosure and transparency, diversified financing sources and improved governance and sustainability compliance. Simultaneously, it will attract new investors to the stock market and introduce new securities, thereby increasing liquidity and trading levels.

Finally, FRA is fully committed to continuously developing and innovating the Egyptian Capital Market. This ongoing effort will bolster its competitive standing and enhance its capacity to attract both investors and companies for listing and trading. Ultimately, this supports Egypt’s drive to broaden the ownership base of its companies through exchange listings and offerings, leading to a positive and developmental impact on both market and economy.