In a landmark move for Egypt’s financial sector, Catalyst Partners Middle East has completed the country’s first-ever special purpose acquisition company (SPAC) merger through the acquisition of digital lending startup Qardy in a deal valued at EGP 1.16bn (c.$23.15m).
The transaction, announced this week, makes Qardy the first fintech startup in Egypt to go public via a SPAC structure — a relatively new mechanism for the region that is expected to gain traction in the coming years.
Founded in 2022 by Abdel Aziz Abdel Nabi, Aser Yahya, and Tamer El-Manesterly, Qardy operates as a digital lending marketplace connecting small and micro enterprises (SMEs) with financial institutions. The startup offers loans, factoring, and leasing services, aiming to bridge the financing gap for underserved segments of the Egyptian economy.
“This deal confirms our shared commitment to innovation in non-banking financial services and empowering SMEs,” Qardy said in a statement. “With this merger, we will continue to operate with our existing team and platform, while gaining access to capital, infrastructure, and long-term strategic backing that will allow us to scale more rapidly.”
SPAC Milestone
Catalyst Partners Middle East — an affiliate of Cairo-based impact investment advisory firm Catalyst Partners — became Egypt’s first approved SPAC after receiving clearance from the Financial Regulatory Authority (FRA) in September 2024. The acquisition of Qardy is being executed through a full or partial share swap, with new shares in Catalyst issued in exchange for the entirety of Qardy’s equity.
The move represents a significant step for Egypt’s nascent SPAC market, which is being closely watched as a potential alternative path to funding and public markets for high-growth startups. It also marks Catalyst’s first public transaction under its plan to acquire multiple companies in the fintech and non-banking financial services space.
Catalyst’s chairman Maged Shawky has said the firm intends to acquire six to ten companies, with at least two expected to come from the fintech sector. The Qardy acquisition is the first major execution of that strategy and aligns with national economic goals to deepen financial inclusion and support private sector-led growth.
Qardy’s Fast Rise
Despite being just over three years old, Qardy has demonstrated rapid growth and strong product-market fit in a largely underserved financial market.
Since launch, the startup has onboarded more than 6,000 corporate clients and facilitated over $12m in loan transactions through its platform. It has formed partnerships with several Egyptian banks and non-banking financial institutions, providing financing solutions tailored to the working capital and expansion needs of MSMEs.
In August 2024, Qardy closed a seven-figure pre-seed funding round backed by investors including White Field Ventures, Vastly Valuable Ventures, and a number of angel backers. The capital was earmarked for regional expansion and tech infrastructure upgrades — ambitions that are now likely to be accelerated under Catalyst’s ownership.
Catalyst laid significant groundwork ahead of the transaction. In December, it listed 1 million shares on the Egyptian Exchange (EGX) at a nominal value of EGP 10 per share, increasing its issued capital to EGP 10m. Earlier, its shareholders approved a capital increase to EGP 235m, involving the issuance of 22.5 million additional shares. The FRA has approved the raise, with investor subscriptions open until Thursday.
The structure and execution of the Qardy merger — the first in Egypt via a SPAC — could set a precedent for future deals in the region. SPACs have gained momentum globally as vehicles to bring high-growth companies to market with greater speed and flexibility than traditional IPOs. Their use in MENA, however, remains limited, largely due to regulatory and market maturity challenges.
Qardy’s acquisition sends a strong signal about the growing appetite for digital financial services in Egypt, particularly those aimed at underserved SMEs — a sector that comprises over 80% of private employment in the country. As the Egyptian government pushes to digitise its economy and widen access to finance, deals like this could catalyse further investment into fintech infrastructure and services.
For Catalyst, the acquisition offers a strategic foothold in a high-growth vertical with significant economic and developmental upside. For Egypt’s startup ecosystem, it shows that public market mechanisms like SPACs — long absent from local dealmaking — may now be a viable route for exits and scale.
Whether this deal paves the way for more SPAC mergers in the region remains to be seen, but for now, it represents a bold step forward in aligning innovative fintech solutions with Egypt’s evolving financial architecture.