In a statement to the Egyptian Exchange, the FRA stated that Compass Capital aims to acquire a stake of no less than 51% and up to 90% of the targeted company’s capital in order to maintain its listing on the Egyptian Exchange.
The offer included the acquisition of 100% of Pachin shares at an initial price of EGP 29.5 per share, and Eagle Chemicals will start the procedures for due diligence technical examination, and it will exceed the offer of National Paints at a price of EGP 0.50 per share.
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Amr Ismail, the managing director of Pachin, told Daily News Egypt that the board of directors will discuss the offer, and will take the necessary measures, which may include appointing a financial advisor to determine the fair value of the company’s shares.
Naeem Research values Pachin with a Target Price (TP) of EGP25.7 per share and recommends to buy. The company’s financial performance is expected to improve between fiscal year (FY) 2021 and 2024, as increased demand is likely to raise utilisation rates and improve margins. In addition, oil price stability will be positive for Pachin as roughly 80% of costs of goods sold are raw materials linked to global oil prices.
The protocol aims to achieve an integration of financial and human resources for each of the two companies in production, research, development, quality, purchases, sales, and marketing
