EFG Hermes, the Middle East's top investment bank, said on Sunday a merger deal with Qatari investment company QInvest will lapse on May 3 unless it receives long-awaited approval from Egyptian regulators.

EFG said it had received regulatory approval from a number of countries for the deal, under which it would initially inject its core business into a joint venture 60 percent controlled by QInvest.

"If EFG does not receive a 'no objection' from the (Egyptian Financial Supervisory) Authority in the coming days, it will be difficult to implement the joint venture agreement," the Egyptian company said.

The joint venture would inject more than $300 million of direct investment into the Egyptian economy, EFG said.

A spokesman for the authority said the deal was still being studied and that a decision would be announced at the right time, declining to give any details or time frame.

EFG issued the statement on a day when Egyptian Central Bank governor Hisham Ramez was visiting Qatar, his office said.

The deal is politically sensitive in Egypt because both of EFG's chief executives, Hassan Heikal and Yasser El Mallawany, are on trial, along with the two sons of ousted President Hosni Mubarak, on allegations of illegal share dealings in relation to a 2007 transaction.

If regulators approve the agreement, they may face criticism for letting executives accused of profiting in the Mubarak era further their gains under the new government.

On the other hand, Qatar is Egypt's main political and financial backer in the Gulf and has pledged $5 billion to Cairo in loans and grants to help keep the most populous Arab country afloat. QInvest is majority-owned by Qatar Islamic Bank.

The transaction includes EFG's brokerage, research, asset management, investment banking and infrastructure businesses.

QInvest would inject $250 million into the joint venture and have the right to buy the remaining 40 percent over a period of 12 to 36 months after the close of the transaction for $165 million or a fair market valuation.

EFG shareholders would receive a one-off dividend of LE4 ($0.58) per share after the deal closes, which was originally expected in the third quarter of 2012.

The contract between QInvest and EFG Hermes is due to expire 12 months after the agreement was first signed on May 3, 2012, EFG said.