By ; Mohamed Elkholy 

Al-Ahly Pharos investment banking, the investment banking arm of National Bank of Egypt, proudly announced that they acted as a financial advisor, lead manager, book-runner, and underwriter for the successful closure of Al Ahly Sukuk 3rd Sukuk issuance in the form of Sustainability Linked Musharaka Sukuk worth EGP 2.4bn to finance a part of the first phase of CAPMED a state of the art fully integrated healthcare city on a total area of 144 acres to establish a full-fledged healthcare city in efforts to transform healthcare in Egypt, a project owned by EHCS SAE.

This hospital under construction is the first step towards an integrated healthcare project that EHCS intends to establish as part of its efforts to develop healthcare in Egypt and contribute to economic development. Upon completion, the Capital Med will employ more than 25,000 healthcare professionals and will also contribute to supplying the Egyptian healthcare sector with more than 4,000 beds, 700 intensive care units, and 70 operating rooms, serving more than 5 million patients annually, given the shortage of available beds in the Arab Republic of Egypt.

The project also aims to attract medical tourism to Egypt, which enjoys a unique geographical location covering approximately 0.5 billion people living within a four-hour flight magnitude. This will be achieved by providing world-class medical services and distinguished specialties. Capital Med will offer 14 specialized centers, such as an injury rehabilitation hospital, a women's health hospital, an organ transplant hospital, a specialized liver institute featuring the latest treatment technologies for all liver diseases, the first private medical hospital specializing in cardiology, and a remote medical consultation service. It will also include non-medical facilities serving patients and visitors, such as a hotel, a shopping mall, and transportation services

This landmark transaction marks the first sustainability-linked Musharaka sukuk and the debut issuance for the healthcare industry in the Egyptian market for a greenfield company which reflects a significant milestone in Egypt’s growing debt capital market which will open the door to similar projects to step in the Debt Capital Market and enhance the spectrum of financing opportunities and innovative debt solutions. This issuance represents a historic first for the healthcare sector. EHCS’s choice of Al Ahly Pharos as advisor for their 1st transaction in the debt capital markets with a unique and challenging structure is a milestone that underscores the unwavering confidence clients place in Al Ahly Pharos. Entrusting them with a mandate of this scale and complexity reflects the deep-rooted advisory expertise and the client’s full trust in the ability of Al Ahly Pharos to structure and execute innovative, tailored-made financing solutions.

Dr Hassan El-Kalla, Chairman and Managing Director of EHCS, stated that the vision of establishing a smart and fully integrated healthcare city has long been a dream for healthcare professionals in Egypt. Today, this ambition is becoming a reality, transforming healthcare provision while also contributing to national economic development by strengthening the role of the private sector. The initiative has evolved into a pioneering project designed to meet both local and regional healthcare needs. CapitalMed project developed by the “Egyptians for Health Care Service (EHCS)” represents a transformational project that combines healthcare excellence with long-term economic value creation.

Strategically, it will be built in Badr City, across from the New Administrative Capital, close to New Cairo and various new communities. CapitalMed is positioned at the heart of one of the fastest-growing urban clusters in the region. It will serve a population of more than five million people living within a 20-minute radius and more than 20 million people living within a 90-minute radius. EHCS is looking for a long-term partnership with Ahly Pharos and Sukuk Program Partners to achieve a unique access story of cooperation. 

Ahmed Heider CEO & Managing Director of Al Ahly Pharos Investment Banking Group quoted “This transaction is a strong testament to the depth and strength of Al Ahly Pharos’ advisory platform, and it reinforces our strategic vision to drive innovation and broaden accessibility within Egypt’s capital markets in all DCM, ECM and M&As more corporates actively pursue alternative financing tools, we remain steadfast in our commitment to leading the evolution of capital market instruments aligned with the broader vision of NBE Group to deliver a fully integrated financial service platform”

Heidar also added “I would like to sincerely thank our exceptional team for their tireless efforts, and our client, EHCS, and Dr. Hassan Elkalla in specific for their continued trust and long-standing partnership and for making us a part of this massive project. This transaction reflects the strength of our relationship and our shared commitment to growth. I am equally grateful to all parties involved in successfully closing this deal, your collaboration and dedication are truly valued and integral to this success as well as the Financial Regulatory Authority for their continuous support and forward-looking approach”.

In the same regard, Amir Sherif, Managing Director and Head of DCM, at Al Ahly Pharos added that “This transaction marks a significant milestone not just as a first of its kind issuance, but as a clear step forward in realizing our broader vision for Egypt’s debt capital markets and a clear mark for the innovative solutions we aim to deliver. At Al Ahly Pharos, we are committed to offering tailor-made financial solutions, both conventional and non-conventional, that respond to our clients’ diverse and evolving needs. Sukuk is only one piece of the puzzle, this is just a scratch on the surface of our hopes and aspirations for the expansion and deepening of the market. Our ambition is to lead in structuring innovative, flexible and trail-blazing instruments that fuel corporate growth and market development.”

Continuing Amir expressed “I am incredibly proud of the tremendous efforts exerted by our Debt Capital Markets team. In just three years, this team has successfully concluded over EGP 100 billion in structured and diversified transactions, leaving their strong and lasting print on the Egyptian market, all being the fruit of their sleepless nights and magnificent efforts exerted to always meet our clients’ needs”.

This transaction was carried out in cooperation with Al Ahly Pharos, National Bank of Egypt, Suez Canal Bank and AlBaraka Bank who acted as the transaction’s underwriters. While ADCB, and IDB participated in the issuance with a coverage ratio exceeding the issue size which indicates the strong desire of investors to participate in such kind of issuance and diversifying their investment portfolios. While National Bank of Egypt acted as the Placement Agent and Suez Canal Bank acted as the Payment Agent, Zulficar and Partners acted as the Legal Advisor, Baker Tilly as the transaction’s Auditor, MERIS "Middle East for Credit Rating and Investors Service", acted as the Credit Rating Agency for the issue, EMEND as the transaction’s Independent Engineer and RSM as the Independent Financial Advisor.