assignments

Assignment MCS Privateizations

PREVIOUS ASSIGNMENTS

A Selection of our Previous Management Consultancy Assignments:

Project: National Bank of Egypt (NBE)

BDO Khaled & Co. was honored to be appointed by the Central Bank of Egypt (CBE) collectively with the National Bank of Egypt (NBE), in order to conduct one of the most comprehensive assignments involving a full due diligence on the NBE, which is the largest bank in the Middle East, having approximately 315 branches and offices. The full report submitted to the CBE and NBE received great appreciation from the Top Officials/Management of both NBE and CBE.

Project: Ministry of Water Resources and Irrigation (MWRI)

BDO Khaled & Co. as the leader of a consortium accomplished a major Public Private Partnership (PPP) assignment serving the Ministry of Water Resources and Irrigation (MWRI) to promote the West Delta Conservation and Irrigation Rehabilitation Public Private Partnership Project, where the project is 85% financed by the World Bank, with an amount of US$ 175 million. Our major role was to promote the project throughout its various phases until a Private Operator is appointed as the Private Sector arm that is to Design, Build, and Operate the project.

Project: SEMAF

BDO Khaled & Co. together with National Bank of Egypt (NBE) and the International Investment Advisor (TIIA) being the investment banking advisor of the Metallurgical Industries Holding Company (MIHC), won the investment banking mandate for the privatization The General Egyptian Company for Railway Wagons and Coaches "SEMAF" after a competitive bidding process between seven local and international investment banking firms.

Our scope of work was to immediately initiate a market-sourcing and to approach strategic investors and financial investors who can establish a joint venture with a technical Know-How partner. In parallel to this we were in the process of preparing the Information Memorandum bidding documents and data room.

Project: Egypt Financial Services (EFS) Project

We have participated in Egypt Financial Services (EFS) project funded by USAID. A five-year $32 million project with the objective of implementing pioneering initiatives to assist Egypt create a vibrant real estate finance sector in Egypt.
To achieve this, EFS concentrates its technical assistance on key initiatives that separately and cumulatively serve to enhance opportunities all at decreased risk to both lenders and borrowers.

Project: Capital Markets Development (CMD) Project

Prior to EFS project we have also participated in the Egypt Capital Markets Development (CMD) project funded by USAID to provide Egypt with assistance developing and improving its capital market. The project worked with eight institutions; the Capital Market Authority (CMA), Cairo and Alexandria Stock Exchange (CASE), Misr for Clearing, Settlement, and Depository (MCSD), the Central Bank of Egypt (CBE), the Ministry of Economy and Foreign Trade (MOE), the Ministry of Finance, and members of the securities industry, represented by the Egyptian Capital Market Association (ECMA) and the Egyptian Investment Management Association (EIMA). The Project's technical assistance to these institutions concentrated in four basic areas; institutional development and training, information technology assistance, legal and regulatory improvements, and public awareness and outreach.

Project: Labour Restructure

We have assisted four Public Sector Companies, through a leading governmental organization, in setting up a comprehensive scheme for labour restructure. The scheme has covered possible alternative methods of finance. We have also helped in preparing a number of state-owned companies for privatization, through restructuring their work force and developing alternative plans for early retirement.

Project: Reorganization of Internal Audit Function

We were engaged by the USAID program to critically evaluate the status of the internal audit function in one of the major specialized banks. The review project was divided into four stages and resulted in comprehensive recommendations for reorganization of the internal audit, development of an internal audit manual and identification of staff training needs.

Project: Financial Analysis and Profit Projection

We have carried out a financial analysis study of a major specialized bank to assess its performance over the past eight years. Trends and observations from our study were used as an input to a subsequent profit projection study, taking into consideration the bank's strategy and business objectives for the next five years.

Project: Bank Assets & Liabilities Valuation

For a group of Kuwaiti Investors, we have carried out a valuation of the assets and liabilities of an Egyptian bank. Business consultations were provided in respect of possible restructure, revised future strategic objectives, and suggested courses of action.

Project: Bank Restructuring and Reorganization Study

We conducted a restructuring and reorganization study of the Principal Bank, employing over 40,000 staff. During the study, we evaluated the existing organizational structure, functional statements, job descriptions, human resources management and other management practices. At the conclusion of the study, we made significant recommendations/ proposals in areas of organizational development and structure and the current management practices, together with a detailed implementation plan.

Project : Internal Audit Training

We have conducted a massive internal audit training program for one of the banks. Participants are presented with the relevant technical materials and practical case studies in the classroom sessions (12 days). This is followed by on-the-job training in the field, where approved audit programs are professionally applied and proper working paper files are prepared (12 days). This is considered one of the most successful training projects presented by the bank.

Project: Litigation Support

We carried out a cost verification exercise of the claim submitted by our client against a French company before the International Arbitration Tribunal in Paris. Our report demonstrated in detail the cost effect associated with the defaults of the equipment supplied by the French company the decision was in favor of our client.

Project: Due Diligence & Purchase Investigation

We have provided expertise to a large number of investors, who engaged us to carry out full scope business, financial and management reviews of companies subject to acquisitions and mergers. Our due diligence reports were used as a basis for share valuation and bidding for a majority stake in many private and state-owned companies. Examples include:

An international UK- based client, which engaged us to carry out a due diligence review of a target company located in Egypt. This target company is in the business of cultivation of animal feeds as well as raising cattle and chicken for the purposes of milk and egg production.

A major banking client based in the Gulf also requested our assistance in purchase investigation work on a target Bank located in Egypt. This target Bank is a medium sized bank with several branches located in Cairo and Alexandria.
We have carried out a purchase investigation for an international client based in Kuwait to increase its interest in a target company located in Egypt, which conducts business in securities trading and portfolio management.

Other major assignments we have handled in this category include purchase investigations and due diligence reviews of target companies in pharmaceutical, F&B, steel, textile, banking, and insurance industries.

We have performed a full scope due diligence review of a target public sector company engaged in the exploration and production of Gypsum for the benefit of an international French company. The end result of this engagement was a successful acquisition of the target company by the French company.

Business and Share Valuation

We possess considerable experience in business valuation in a wide variety of mergers and acquisition transactions. We have provided expertise in this field to a large number of international or local investors before they sell or acquire a stake in joint stock companies in Egypt. For each case, we use a tailor-made valuation technique as appropriate. Examples of the various analysis techniques/computations we use include: net-assets, discounted cash flows, discounted earnings, capitalized cash flows, capitalized maintainable earnings, benchmarking to similar transactions and marketable securities listed on the stock Exchange. Our experience in this field covers manufacturing, trading / service, oil beverage companies, and banks. Our latest assignment was the valuation of Al Gouna Group of companies (9 companies) taken over by Al Ahram Beverages Co.

Regulatory Bodies

We have been appointed as members of a committee put together by the Capital Market Authority to report on the financial aspect of the valuation of private companies going public. Also, we have been appointed as members of a committee created by the Capital Market Authority to set up rules for reporting on mutual funds, including policies for portfolio valuation.

In addition, we were appointed as members of the Independent Accountants Committee invited by the Central Bank of Egypt. The Committee was engaged in setting up the disclosure and presentation requirements for the financial statements of the banks operating in Egypt. We are also members of the committees formed to establish International Accounting Standards and Egyptian Auditing Standards.

Corporate Finance

We were engaged, as members of a team of international investment banking companies, in raising funds for joint stock companies in Egypt through offering and promoting their securities to investors in international and local capital markets. Our experience in this field includes developing information memorandums, offering circulars, prospectuses, and listing particulars for both the London and Cairo stock Exchanges. We compiled, reviewed and sometimes audited the relevant financial and management information, then reported in an appropriate form according to different reporting standards. Basically, we were the first accounting firm in Egypt to compile and report financial information of a100% state-owned company in accordance with the US Generally Accepted Accounting Principles (GAAP) and the International Accounting Standards (IAS). State-owned companies maintain their books according to the government Unified Accounting System (UAS) which has different accounting policies and practices from those of GAAP and IAS. Our exercise therefore had a great impact in facilitating and enhancing foreign investors' understanding of the securities offered, and encouraging them to participate in the Egyptian capital market. Our work was taken as an example followed by other firms.

Financial Structure

We have helped a number of big firms in Egypt to enhance their financial reporting by developing an IAS-based accounting system . Again, this practice enhanced the understanding of their financial statements by external users and attracts prospective investors into business. It also encourages family owned companies to go public, through offering their shares to new investors.