Cleopatra Hospital Company (SAE) announced an indicative price range for its public offering on the Egyptian Stock Exchange on Wednesday.
The largest private hospital group in Egypt – measured by number of hospital beds or operating hospitals according to CEO Ahmed Ezzeldin – intends to offer up to 40 million ordinary shares, representing 25 percent of existing ordinary shares, at between EGP 8.75 and EGP 11.88 per share, after receiving approvals from the EGX, according to a statement by the company.
The group, which holds majority stakes in four multi-specialty hospitals in the Greater Cairo area, reported operating revenues of EGP 741 million in 2015, while gross profit stood at EGP 234 million, EBITDA at EGP 183 million and net profit for the year at EGP 52 million, on an unaudited, pro-forma basis.
The offering will include an international offer to institutional investors of up to 34 million ordinary shares of the company and a domestic retail offer of 6 million shares in Egypt to raise capital for expansion.
“We look forward to a capital injection from the ongoing transaction to fund our capital expenditure, develop extensions of Shorouk Hospital and Cleopatra Hospital, roll out our new polyclinic model, and look to acquire a site in New Cairo to develop into a new hospital,” said Ezzeldin.
Cleopatra is 99 percent owned by Care Healthcare Limited, which is beneficially owned by UAE-based private equity firm Abraaj’s North Africa Hospital Holdings, the European Bank for Reconstruction and Development (EBRD), Deutsche Investitions- und Entwickungsgesellschaft mbH (DEG), and the Société de Promotion et de Participation pour la Coopération Economique SA (Proparco).
The company will then offer Care Healthcare the right to subscribe for up to 40 million new shares at the offer price by way of a closed subscription following the completion of the offer.
The move is designed to complete the capital increase by injecting the proceeds of the first sale back into the company, explained Mohamed Radwan, head of equities at Cairo-Pharos Holding, which is the manager of the offering.
Global Coordinator and Bookrunner EFG Hermes will use 15 percent of the proceeds of the first offering to create a stabilisation account to protect retail shareholders from initial share price drops.