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Monday, 12 April 2021

From the trading floor

Sherine Abdel-Razek , Wednesday 7 Apr 2021
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Cairo for Investment and Real Estate Development (CIRA): Egypt’s largest provider of educational services has acquired a 51 per cent stake in the nursery operator Innovette for Education.

CIRA, which operates 21 schools nationwide and owns Badr University in Cairo (BUC), plans to invest some LE50 million to expand Innovette’s activities with plans to start 25 nurseries within five years. The first three will operate under the Steamulation Hub and KidzGround brands and will commence operations in different governorates in May this year, being dedicated to offering high-quality education, a nurturing environment, and innovative learning methods at affordable prices to higher and middle-income groups, according to a CIRA press release.

Innovette was founded in 2020 by Dina Abdel-Wahab, who has been active in investing and operating early childhood nurseries like The Baby Academy, Indimaj, and Camp-O-Mania. This is CIRA’s first foray into the nursery and pre-school segment. 

 

Cleopatra Hospitals Group (CHG): The group expects 20 per cent growth in its revenues in the fourth quarter of the current fiscal year, bringing 2020 revenue growth to more than 10 per cent.

In a recent company webinar, group executives said that CHG had seen very strong performance in 2020 as patient volumes had grown along with a favourable case mix. Established in 2014 and listed on the Cairo Stock Exchange in 2016, CHG is Egypt’s largest private hospital group by number of hospital beds and operating hospitals.

The group currently operates six hospitals alongside two newly inaugurated polyclinics, encompassing a total of 779 beds. Hospitals affiliated to the group include the Cleopatra Hospital, the Cairo Specialised Hospital, the Nile Badrawi Hospital, and the Al-Shorouk Hospital, along with the two latest additions of the Al-Katib Hospital and Queens Hospital.

Group management worked on various initiatives throughout the second and third quarters of 2020 to meet Covid-19 challenges and to ensure revenue stabilisation, creating patient flow and filtering and processing Covid-19 patients followed by utilising the newly acquired hospitals of Al-Katib and Queens and transforming them into Covid-19 facilities. By December 2020, utilisation rates in Al-Katib and Queens were 90 to 100 per cent.

According to takeaways registered by Pharos, a brokerage, from the webinar, the group has been adding to its facilities throughout the year: Nile Badrawi has more than two new floors, and Al-Shorouk has a new polyclinic and pharmacy in an adjacent building. The group has started renovation work at the Cleopatra Hospital along with renovations at the Cairo Specialised Hospital.

Al-Katib and Queens will keep operating as Covid-19 facilities in 2021, at least for the first two quarters of the year. CHG concluded 2020 with news of a potential merger with the Alameda Group, owner and operator of the Dar Al-Fouad and Al-Salam International Hospitals.

“CHG sees the transaction as quite transformational, which will allow it to double the number of beds and double the earnings value in addition to having a wider patient segmentation and more extended geographical coverage,” Pharos said. The combined group is expected to hold around 15 per cent of Greater Cairo’s commercial bed capacity, with CHG currently holding eight per cent and Alameda bringing seven per cent to the new entity. 

CHG realised more than LE2 billion in revenues in 2020, while Alameda’s nine-month results came in at LE1.49 billion despite the pandemic. Due diligence for the deal is taking place amid reservations about the new entity monopolising the private-hospital sector in Greater Cairo. 

 

E-Finance: The state-owned e-payment platform, soon to offer an IPO, is being eyed by the Sovereign Fund of Egypt (SFE), which is currently studying a plan to acquire part of the National Investment Bank’s (NIB) 69 per cent stake in e-Finance.

The SFE revealed plans last year to expand its investments in the non-banking financial-services sector. It currently has nearly LE26 billion in assets under management, and the potential transaction is expected to close in the first half of this year. The government has postponed the E-Finance IPO from the fourth quarter of 2020 to the first half of 2021.

 

Suez Cement: The leading cement producer that is planning to delist from the Cairo Stock Exchange later this year has sold its 51 per cent stake in Kuwait’s Hilal Cement for LE155.8 million, after which Suez Cement’s representatives resigned from the board.

Suez Cement opted to sell its stake in the Kuwaiti company, bought in 2007, due to the turbulence in the local cement market due to the oversupply that led its subsidiary Torah Cement to stop production in 2019 after the accumulation of LE800 million in debt. Torah, Egypt’s first cement company, was founded in 1927.

In November, the Suez Cement board gave the green light for mother company Heidelberg Cement to buy the 33 per cent stake it does not hold in the company through buying minority shares in a mandatory tender offer.

*A version of this article appears in print in the 4 March, 2021 edition of Al-Ahram Weekly

 

 

 

 

 

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