valU, Mena’s leading lifestyle-enabling fintech platform, has closed its fifth securitised bond issuance worth EGP1.42 billion ($45.88 million) issuance which is part of a newly approved EGP4.0 billion programme. 

 

The bond is backed by a receivables portfolio, assigned to EFG Hermes’ Financial Group for Securitisation, the issuance’s Special Purpose Vehicle (SPV), and is composed of two tranches, structured as follows: 

 

*Tranche A – Valued at EGP946.3 million with a 12-month bond tenure and a Prime 1 (sf) rating 

*Tranche B – Valued at EGP476.7 million with a 36-month tenure and A (sf) rating

 

Critical move

Shokry Bidair, CFO of valU, commented: “This comes as part of a newly approved, longer-term programme. This step is a critical move in our strategy to expand valU’s operational scope beyond Buy-Now, Pay-Later (BNPL) and reposition the company as a full-fledged lifestyle enabler and end-to-end provider of innovative and convenient fintech solutions that better the lives of our clients and serve their ever-changing financial needs. We are confident in our ability to post our fourth successive year of both growth and profitability while investing in new opportunities to cement our leading market position. 

 

“This securitisation will further enhance our liquidity position and help us meet our ambitious growth targets for 2023. Building on the success of our previous securitisations’ performance, this offering includes a three-year tranche which will pave the way for us to further tap the debt capital market in more innovative ways in the future.” 

 

Leveraging a network of over 5,000 points of sale and over 700 e-commerce websites and apps, valU’s beginnings since its inception as a BNPL provider in December 2017 saw the company offer convenient and inclusive financing plans to its clients with tenors ranging from 3 to 60 months. Having continuously broken ground in the market through its disruptive but fundamentally integrated solutions and partnerships over the years, valU is today an Egyptian household name and has successfully transformed into a comprehensive fintech powerhouse and a facilitator of financial empowerment and inclusion in the market offering investment products, an instant cash redemption programme, and savings solutions through the AZ valU fund, Sha2labaz, and Akeed, respectively.

 

Largest transaction

Maie Hamdy, Managing Director, Debt Capital Markets at EFG Hermes, said: “After four successful issuances, we are incredibly proud to continue our partnership with valU on its fifth securitisation issuance — its largest transaction in the Egyptian debt capital market to date. This transaction comes as part of several back-to-back transactions we’ve concluded this year, including Bedaya’s first securitisation issuance — the first for a real estate mortgage company in Egypt.”

 

This transaction marks valU’s second issuance this year, and the fifth concluded in partnership with EFG Hermes to date, underscoring valU’s efforts to diversify its funding streams as it continues to scale its operations further and expand its presence in the fintech landscape. 

 

EFG Hermes acted as sole financial advisor, sole transaction manager and book-runner, underwriter, and arranger on the issuance. Arab African International Bank (AAIB) acted as underwriter as well as custodian bank on the issuance. Arab Banking Cooperation (ABC) and aiBANK were subscribers to the issuance. KPMG was the auditor and Arab Legal Consultants was the legal advisor.-- TradeArabia News Service