The referral of EFG-Hermes' top two executives to criminal court was not the only surprise investors in the financial powerhouse had to deal with last week. Sherine Abdel-Razek reports on the breathtaking developments hitting Egypt's largest investment bank In one week, investors of Egypt's largest investment bank approved an earlier planned joint venture with Qatar's QInvest, received a bid for all their shares from a new company co-owned by IT tycoon Naguib Sawiris, and saw the bank's two CEOs referred to criminal trial. The events unfolded at a breathtaking pace that sent the company's shares up and down, leaving investors in shock and market observers in confusion. Yasser El-Malawani and Hassan Heikal -- the two CEOs referred to criminal court -- are both well-known names in the investment banking industry and contributors to the group's fast rise to top of the industry on both the local and regional level. Together with ousted president Hosni Mubarak's two sons, El-Malawany and Heikal were charged with insider trading in the sale of Al-Watany Bank of Egypt in 2007. EFG was the advisor on the sale deal at the time. The defendants are accused of violating disclosure rules by using offshore funds to gradually buy in what has mounted to 80 per cent of Al-Watany Bank's shares without full disclosure made to the stock market, hence capturing LE2 billion worth in illicit gains from the sale. As shocking as this development was, an out-of-the-blue bid by a group called Planet Investment (Planet IB) to buy 100 per cent of shares of the investment bank, with all its subsidiaries, was not less shocking. Offering a 23 per cent premium on the share price of EFG on 31 May, the offer is valued at LE6.5 billion. EFG rejected the two letters of intent that Planet IB has so far submitted as it failed to provide any legal commitment or guarantee to conclude the a tender offer, any proof of availability of funds, or information about the identity of investors providing necessary funds for the tender offer, according to an EFG statement. These factors led EFG-Hermes' management to doubt the seriousness of the offer. But while the new bidder is largely unheard of, the list of its owners and executives is exceptionally impressive. The company was formed mainly to buy EFG and is co-owned by businessman Naguib Sawiris together with Tariq Bin Faisal Al-Qassimi, son of the ruling family of the UAE's Al-Sharjah emirate, and a top Bahraini institution. Those managing the company include chairman Mahmoud Abdel-Latif, Egypt's veteran banker, who helped in restructuring and then privatising the Bank of Alexandria, and CEO Ahmed El-Husseini, who until a month ago was the managing director of Egypt's largest private equity concern, Citadel Capital. The problem with Planet IB's offer is that it came two days before the shareholders of EFG, including Dubai Financial Group and the Abu Dhabi Investment Authority, the emirate's sovereign wealth fund, voted in favour of an earlier planned joint venture with the Qatari investment bank QInvest. Planet IB has so far sent only a letter of intent to both EFG and the regulator and it needs the approval of the latter -- and not of EFG management -- to start due diligence, an assessment of the bank, based on which it will submit its tender offer. "Planet IB should have filed its tender offer to the Egyptian Financial Supervisory Authority regardless of the approval of the company's shareholders, general assembly or the management," EFG Chairwoman Mona Zulficar said in a statement justifying rejecting the offer. From his side, Abdel-Letif told Bloomberg that Planet IB had already appealed to the regulator and would meet with Prime Minister Kamal Al-Ganzouri to suspend the QInvest deal temporarily to give Planet IB time to perform due diligence on EFG. The increased interest in the investment bank comes due to its leading position in the sector as well as its being attractively priced. EFG's market value has more than halved to less than $870 million since the 25 January 2011 uprising. The QInvest offer excludes EFG's Bank Lebanese, the Lebanese commercial bank it bought recently, together with the private equity business. The Qatari bank will inject $250 million in capital increase. On the other hand, Planet IB's takeover bid would ensure that the company is not broken up, the bid consortium said Friday. Abdel-Latif said the buy-out plan would see EFG expand into Africa and cut its costs while keeping staffing "intact". The independent advisor Grant Thornton valued eight of EFG's subsidiaries in Egypt at LE700.5 million. This value excludes the value of subsidiaries located in the Gulf. EFG-Hermes operates in Egypt, Saudi Arabia and the United Arab Emirates, and would extend its reach to Turkey and as far as Southeast Asia through the QInvest venture, which still needs regulatory approval. EFG, which has $4.7 billion in assets under management, has securities brokerage, investment banking, asset management, research and private equity operations and a controlling interest in Lebanese lender Credit Libanais. EFG said it would distribute a dividend of LE4 ($0.66) per share after it completed its joint venture with QInvest, in which the Egyptian firm would control 40 per cent and the Qatari firm 60 per cent.