This transaction marks Ergo’s first investment since its establishment. It will be used to transform the company into a professional, institutionalised, end-to-end visual media production and distribution entity.
The investment will be a combination of equity that will be used to restructure and build the Company, and debt to finance its projects.
“The establishment of Ergo Media Ventures, as well as this investment, reflect the government’s strong commitment to helping today’s media visionaries capitalise on Egypt’s competitive advantage and transform their ideas into impactful and exciting business opportunities that re-write culture and drive sustainable, long-term growth,” Dr Hala El Said, Minister of Planning and Economic Development said.
It aims to re-establish the Egyptian media and entertainment industry as a sustainable economic, social and cultural power by focusing on investing in companies working in digital and traditional content creation and distribution.
“Ayady’s establishment of Ergo reflects Ayady’s commitment to investing in a diversified portfolio of opportunities, not just in traditional high impact sectors, but also in sectors which investors are not familiar with, which paves the way for more investments to come into this vital sector that has not had its fair share of organized investments in the past,” Osama Saleh, Chairman of Ayady, said.
Ergo’s investment in Film Clinic aims to institutionalise film production and support local visionaries to become regional champions and help develop their footprint in the region; especially in times of increasing demand for quality content, locally and regionally, with new markets opening up, changing media consumption habits, digitisation and recovering economic conditions.
“We expect that Ergo’s financial and strategic support to Film Clinic will enable it to capitalise on the paradigm shift in the movie distribution channels from the traditional box office to the digital platforms to reach out to Arabic content viewers wherever they are all around the world,” Mohamed Metwally, CEO and MD of NI Capital which manages the investments of Ayady and Ergo, said.
It also seeks to create an entity that can cooperate with global players to produce and export quality Egyptian content to the rest of the Arab region and the world and to lead the ongoing efforts to transform the media industry into a major GDP contributor and a generator of employment.
“Since its inception in 2005, Film Clinic’s growth has been marked by several significant milestones,” Mohamed Hefzy, Founder of Film Clinic, said.
“This investment and partnership with Ergo mark the initiation of a new phase for the company that we are very excited about, and I believe of its necessity and importance as a step forward, not only for the evolution of Film Clinic, but for the entire media and entertainment industry in Egypt and the Arab World.”
PwC is acting as financial advisor while Rizkana & Partners and Al Jallaf are acting as legal counsels to Ergo. Jurisera is acting as legal counsel to Film Clinic.