Egyptian property developer Madinet Nasr for Housing and Development’s (MNHD) board has rejected a takeover bid by its rival Sixth of October for Development and Investment Company (SODIC), saying the offer does not represent the company’s true value. MNHD has called on SODIC to reconsider the offer.
MNHD’s portfolio of undeveloped land is worth between three and four times more than what SODIC wants to pay for the company, Abdullah Salam, MNHD’s managing director told CNBC Arabia Monday.
Salam said that MNHD’s undeveloped land has “very promising potential to be developed and become residential and commercial projects,” adding that this is what makes the real estate developer so valuable.
The company’s board said in a bourse filing that it was prepared to restart work to conclude a deal if SODIC put forward an offer matching its fair value. Founded in 1959, Madinet Nasr is a major urban community developer in Egypt that is mainly focused in the East Cairo area, where its two flagship projects, Taj City and Sarai, are located.
Earlier in July, Aldar Properties and ADQ-backed SODIC said that it had submitted an offer to acquire up to 100% of MNHD’s share capital at a price that valued the company at $328 million (EGP 6.18 billion).
The proposed deal is in line with SODIC’s broader strategy to expand its portfolio of mixed-use residential communities in Greater Cairo, the North Coast and other major markets. The company is majority-owned by a consortium comprising Aldar and ADQ, following its acquisition of 85.5% of the company’s shares last December in a transaction valued at about $388 million (EGP 6.1 billion).
