TMG Makes History: Acquires Stake in Seven Egyptian Jewels

Amr Reda Abdullatif, LL.M

Egypt’s leading real estate developer, Talaat Mostafa Group (TMG), has completed a landmark deal to acquire a significant stake in a portfolio of seven historic hotels in Egypt, valued at more than USD 800 million.

The deal was announced by Prime Minister Moustafa Madbouly on December 20, 2023, and involved TMG’s subsidiary, Icon Investments, the Sovereign Fund of Egypt (SFE), and the Egyptian General Company for Tourism and Hotels (EGOTH).

Icon Investments now partially owns and manages the following hotels: Zamalek’s Cairo Marriott Hotel & Omar Khayyam Casino, Marriott Mena House Cairo, Steigenberger Hotel El Tahrir Cairo, Steigenberger Cecil Alexandria, Sofitel Legend Old Cataract Aswan, Mövenpick Resort Aswan, and Sofitel Winter Palace Luxor.

The hotels are currently owned by Legacy Hotels and Tourism Projects Company, a joint venture between EGOTH and SFE’s Egypt Sub-Fund for Financial Services and Digital Transformation. Icon Investments acquired 37% of Legacy’s capital at a value of USD 700 million, in cooperation with an Emirati investor, and may increase its stake to 51% with an additional investment of USD 300 million.

The acquisition is part of TMG’s strategic growth plan as a major player in the upscale hotel sector in Egypt, and aims to develop and modernize the hotels to match the most luxurious international standards, and attract a higher quality of tourism to Egypt.

The deal is also in line with the government’s policy of strengthening the role of the private sector in Egypt and enhancing the investment climate and supporting the national economy.

The deal was facilitated by several senior financial, technical, and legal consultants, including. Mahmoud Moharram, Kamal Tarek Kamal and Omar Farag Legal Counsel’s team at the Sovereign Fund of Egypt. EFG-Hermes as the financial advisor for TMG, EY as the financial and technical advisor for SFE, and several law firms, such as Sarie Eldin & Partners Legal Advisors, Shahid Law Firm, Zulficar & Partners Law Firm, Abou Shoka Law, and Amr & Partners Law Firm.

Dr. Hani Sarey El-Din, founder and managing partner of Sarie Eldin & Partners Legal Advisors, commented, “This acquisition comes within the framework of the government’s plan to expand the private ownership base in the assets it owns, as Talaat Mostafa Group will work to develop the hotels under contract to match the most luxurious international hotels, and maximize its profitability to attract more tourism.” Foreigners coming to Egypt.

Dr. added. Hani, “The deal is one of the most important acquisition deals that the office has worked on during this year, as the office contributed during the past two months to completing the deal for Global to acquire 30% of the Eastern Tobacco Company at a value amounting to 625 million US dollars.”

TMG expressed its gratitude to all the parties involved in the deal and congratulated itself on making history in the Egyptian tourism and hospitality sector.

The deal also received special thanks from Amr & Partners Law Firm, which hosted the final negotiations that took place over three consecutive days. The firm served as the legal advisor for EGOTH and praised the smooth collaboration that was characterized by professionalism, expertise, and a shared commitment to excellence.

EGOTH is a subsidiary of the Holding Company for Tourism, Hotels and Cinema (HOTAC), one of the region’s largest hotel-owning companies that works with many leading hotel brands and owns a large inventory of land in prominent locations in Egypt for tourism and establishing and developing hotels. EGOTH also owns three high and two upper-intermediate hotel institutes in Alexandria, Luxor and Ismailia affiliated to the company which gives their graduates a bachelor’s degree or diploma in tourism & hotels. EGOTH’s hotel capacity amounts to 3760 rooms plus one floating restaurant.

The deal also highlighted the role of EFG Holding, EY, Sarie Eldin & Partners Legal Advisors, Zulficar & Partners Law Firm, Abou Shoka Law, and the legal team of The Sovereign Fund of Egypt in providing financial, technical, and legal support for the transaction. The parties involved in the deal expressed their appreciation for the smooth collaboration that has been characterized by professionalism, expertise, and a shared commitment to excellence.

The deal also involved some prominent legal figures in Egypt, such as Mohamed El Hennawy, VP & Group General Counsel at TALAAT MOSTAFA GROUP HOLDING COMPANY ‘TMG HOLDING’ S.A.E, who has been recognized as one of the best in-house lawyers in the MENA region, Prof. Dr. Mohamed Sameh Amr, founder and managing partner of Amr & Partners Law Firm, Dean of the Faculty of Law at Cairo University, Professor of International Law, member of the National Council of Human Rights in Egypt and a member of ICSID’s Panel of Arbitrators and Conciliators, and Dr. Hani Sarey El-Din,

The deal also involved some prominent legal figures in Egypt, such as Mohamed El Hennawy, VP & Group General Counsel at TALAAT MOSTAFA GROUP HOLDING COMPANY ‘TMG HOLDING’ S.A.E, who has been recognized as one of the best in-house lawyers in the MENA region, Prof. Dr. Mohamed Sameh Amr, founder and managing partner of Amr & Partners Law Firm, Dean of the Faculty of Law at Cairo University, Professor of International Law, member of the National Council of Human Rights in Egypt and a member of ICSID’s Panel of Arbitrators and Conciliators, and Dr. Hani Sarey El-Din, professor of Commercial and Maritime Law-Cairo University, founder and managing partner of Sarie Eldin & Partners Legal Advisors—chairman of the Financial, Economic and Investment Affairs Committee-Egyptian Senate.