Concord to raise $750m in Japan

Egyptian company Concord International Investments aims to raise up to $750 million (Dh2.75 billion) from Japanese investors seeking more exposure to Egypt's undervalued firms and growing economy, the fund manager's chairman told Reuters yesterday.

"Right now we are in the process of launching a series of funds in Japan," Mohamed Younes said in a telephone interview. Younes said the first, with $150m to $200m from Nikko Asset Management, would be launched by the end of the first quarter.

Nikko was owned by Citigroup until last year when a controlling stake was sold to Sumitomo Trust & Banking for $1.2bn.

Concord will also open a private equity fund with $150m and two other funds for listed securities with between $100m and $200m in the second half of 2010, Younes said, without naming the investors.

Younes said the firm identified Japan five years ago as a market ready to invest overseas again after a period of crisis, and that Egypt's fundamentals remained attractive. "Four years ago we started our missionary work, knocking on doors and talking about Egypt," Younes said.

"What you are looking at is the growth rate for the economy, and at roughly five per cent Egypt stands out. More importantly than that, the level of prices in Egypt is very low," he said.

The average price of an emerging market stock is 15-20 times its earnings, Younes said. "In Egypt, for the most active stocks you are barely at eight, nine, maybe 10 times. They are very modest valuations for companies with very attractive growth rates," he said.

Younes told Reuters in October that the private equity group would set up an equity fund by mid-2010 targeting the food and healthcare industries and light manufacturing.

Concord launched two Japanese funds two years ago investing around $180 million in listed Egyptian companies.

Concord, based in New York and Cairo and with an office in Tokyo, has $1.4 billion invested via funds and portfolios, Younes said.

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