Abu Dhabi investment company, ADQ, and its subsidiary ADNEC Group, announced on 12 January the acquisition of 40.5 percent of ICON, the hospitality arm of Egypt-based Talaat Mostafa Group through a capital increase.
The signing agreement marks ADQ’s acquisition of stakes in ICON’s pre-existing portfolio of luxury hotels and resorts, including seven famous historic hotels – Cairo Marriott Hotel, Marriott Mena House, Steigenberger Hotel Al-Tahrir, Steigenberger Cecil Alexandria, Sofitel Legend Old Cataract Aswan, Mövenpick Aswan, and Sofitel Winter Palace Luxor.
This development aligns with Egypt’s Prime Minister Mostafa Madbouly’s previous statement in December, announcing that the country’s sovereign wealth fund had signed a USD 800 million (EGP 24.6 billion) deal to sell a 39 percent stake in the seven hotels to ICON, with the option to raise the stake to 51 percent.
As part of the deal, an international investor would buy a minority USD 882.5 million (EGP 27.2 billion) stake in ICON.
The Abu Dhabi group will also acquire stakes in the Four Seasons properties in Cairo, Sharm El-Sheikh and Alexandria, in addition to the Kempinski Nile Hotel in Cairo.
“The transaction represents a major foreign direct investment in Egypt and marks a strong vote of investor confidence in the Egyptian tourism and hospitality sector,” ADQ said in a press statement.
Having been a consistent investor in Egypt, ADQ previously bought stakes worth around USD 1.85 billion (EGP 33.8 billion at the time) in Egyptian firms in 2022. In 2023, the investment company purchased minority stakes in three state-owned oil and petrochemical sector companies for USD 800 million (EGP 24.6 billion).
Egypt’s hotel sales are a part of its previously announced privatisation programme, as the country plans to sell state-owned assets to boost the private sector and raise foreign currency.
The country’s privatisation programme is in large part due to the economic reforms imposed by the International Monetary Fund through its USD 3 billion (EGP 89.3 billion at the time) loan package to Egypt.
Subscribe to the Egyptian Streets’ weekly newsletter! Catch up on the latest news, arts & culture headlines, exclusive features and more stories that matter, delivered straight to your inbox by clicking here.