CAIRO, June 10 (Reuters) - The $257 million bid by billionaire Naguib Sawiris's New Egypt Fund and Beltone Financial for a 20 percent stake in investment Bank EFG Hermes does not currently meet regulatory requirements, Egypt's financial watchdog said.
"The optional buy offer that was presented to us from Egypt's Beltone and Holland's New Egypt is incomplete," Sherif Samy, the chairman of Egypt's Financial Supervisory Authority (EFSA), told Reuters by telephone late on Monday.
"We will request from them tomorrow morning to meet the requirements relating to the buy offer of a 20 percent stake in the shares of EFG Hermes for the price of 16 Egyptian pounds ($2.24) per share," he added, without giving details.
The potential deal, announced last week, marks a revival of interest in Egyptian equities after more than three years of stagnation following the overthrow of Hosni Mubarak in 2011.
Sawiris is one of Egypt's highest-profile businessmen and his family own the Orascom group of companies, while EFG Hermes is one of the biggest investment banks in the Middle East.
Beltone's board agreed on Monday to a five-to-one share split to boost trading of its shares and increase its investor base after the stock shot up following the news of the offer.
Beltone's shares were up almost 10 percent at the close on Monday to trade at 30.11 Egyptian pounds.
EFSA said last week that an offer had been submitted to buy 20 percent of EFG Hermes's shares. It said the New Egypt Investment Fund would buy 17.82 percent, while Beltone planned to acquire 1.09 percent and Beltone Capital Holding would acquire another 1.09 percent.
The government of Dubai owned 11 percent of EFG Hermes as of the end of March, making it the biggest shareholder, according to Thomson Reuters data. EFG has about 67 percent of its shares free floating, or readily tradable.
EFG Hermes in 2012 agreed a deal with Qatar's QInvest to spin off part of its assets to create an investment bank with operations spanning the Middle East, Africa and Turkey. QInvest would have pumped in $250 million for a 60 percent stake.
But the deal fell through last year after failing to win regulatory approval in Egypt. EFG Hermes, whose operations span the United Arab Emirates, Saudi Arabia, Qatar, Jordan, Oman, Kuwait and Lebanon as well as its home market, said it would instead cut costs and sell off non-core assets.
$1 = 7.1501 Egyptian Pounds Reporting by Ehab Farouk; Writing by Asma Alsharif; Editing by Mark Potter