(Bloomberg) --

Aldar Properties PJSC is considering the acquisition of a majority stake in Egyptian developer Medinet Nasr Housing, according to people familiar with the matter, a deal that would strengthen the Abu Dhabi firm’s presence in the Arab world’s most populous country.  

The discussions are in early stages and an offer may not be imminent, said the people, who asked not to be identified because the matter is private.

The Egyptian government owns a 15% stake in Medinet Nasr. Hisham Tawfik, Egypt’s public enterprise minister, said Aldar has shown interest in the Cairo-based developer, but an offer has yet to materialize. 

Aldar declined to comment. Medinet Nasr said in a Tuesday statement to Cairo’s stock exchange that it hasn’t received any tender offers. Board member Salah Katamish declined to give additional comment when contacted by Bloomberg. 

Aldar bought a majority state in another Egyptian developer, Six of October Development & Investment Co., or Sodic, last year. Sodic in 2018 submitted a tender offer for at least 51% of Medinet Nasr, although the proposal didn’t proceed. A deal would have created the country’s largest developer. 

Aldar, which primarily operates in Abu Dhabi, has been looking to expand abroad as it faces limited growth prospects in its home market, the United Arab Emirates. The developer is seeking to deploy 5.6 billion dirhams ($1.5 billion) on acquisitions this year, looking to grow its holdings of revenue-generating properties. A deal would give Aldar access to a vast land bank in eastern Cairo for development in an under-served market. 

Earlier this year, Apollo Global Management Inc. signed a deal to invest $1.4 billion in Aldar Investment Properties as the two plan to invest across the Middle East. Aldar acquired a 715-room beach resort for $210 million in the emirate of Ras Al Khaimah this year. 

In April, Aldar Chief Financial Officer Greg Fewer said Egypt and Saudi Arabia are the company’s focus as it eyes investment abroad.

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