LCP Fund II (LCP), managed by Lorax Capital Partners, has acquired a significant minority stake in DSQ Group, one of the leading end-to-end loyalty and rewards solutions providers in the CEMEA region.

LCP’s investment mainly consisted of a significant capital increase to support the scaling of new business lines and to further expand the company’s geographical footprint both locally and internationally.

The transaction also included the acquisition of Ezdehar Egypt Mid-Cap Fund’s minority stake. Furthermore, Algebra Ventures, one of Egypt's VC firms and an existing shareholder in DSQ Group, increased its investment as part of this transaction.

Founded in 2011, Dsquares provides its customers with a comprehensive service offering including the set-up, and operational management of all technical and commercial aspects of their loyalty program.

Dsquares operates through a variety of business sectors including Banking, Telecom, FMCG, Retail, Oil & Gas.

The company boasts an unparalleled merchant network with reach spanning more than 900 brands and over 11,000 outlets across various sectors throughout Egypt, Jordan, Romania, Kenya, Tanzania, Morocco, KSA, and UAE.

In 2019, the group launched “Lucky” a mobile platform providing its customers with access to discounts, offers and convenient financial services.

Today, Lucky boasts over 5 million downloads, and a network covering thousands of merchants.

The network includes dinning, entertainment, fashion, electronics, fitness, hospitality, furniture & home appliances, among others.

Ayman Essawy, Co-founder & COO, added: “Lucky continues to be very successful in attracting new users as well as increasing engagement of its existing user base. Egypt is our first market and we have plans to further expand our services across relevant markets in the Middle East & Africa. We believe that this strategic partnership with LCP will put both Dsquares & Lucky on the right track to achieve their future goals.”

DSQ Group is very well positioned to service the growing need for value savings and the strong adoption of innovative digital solutions.

Marwan Kenawy, Co-founder & CEO of Dsquares, said: “The LCP partnership and investment will help Dsquares expedite its clients and merchants expansion plans in the Middle East, Africa and Europe and maintain its position as the loyalty & rewards solutions leader in the region.”

Al Tamimi Law Firm acted as the legal advisor to LCP on the deal.

The company’s legal advisor was Youssef & Partners.

Incorporated in 2015, Lorax Capital Partners is an Egypt focused private equity firm.

LCP’s portfolio includes Fawry for Banking and Payment Technology Services; Sarwa Capital, a pioneer in consumer finance, leasing and securitization; Orchidia Pharmaceutical Industries, an ophthalmic generic medicine manufacturer, Misr Hytech - the largest proprietary corn seed producer in Egypt and NIS Schools, one of the largest blended learning and technology focused private school platforms.