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Tuesday, 15 June 2021

From the trading floor

Sherine Abdel Razek, Tuesday 6 Apr 2021
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Amoun Pharma: The leading local pharmaceuticals manufacturer and distributor is seeing an important change in its ownership structure, with its main shareholder, the Canadian Bausch Health, selling its stake to the Abu Dhabi sovereign wealth fund (ADQ).

The $740 million transaction is part of Bausch's plan to cut down its debt. According to the agreement, ADQ is to make a mandatory tender offer for the total issued share capital of Amoun including the less than one per cent held by minority shareholders. The sale is pending regulatory approval and will be finalised during the first half of 2021. 

“The sale of Amoun marks significant progress in our efforts to reduce overall Bausch Health debt as we continue to pursue all opportunities to drive value for our shareholders, including preparing for the spinoff of Bausch & Lomb,” Bausch CEO Joseph C. Papa said in the statement.

ADQ is Abu Dhabi's third-largest sovereign wealth fund with $110 billion in assets. According to Bloomberg, the purchase is an opportunity for the fund to become one of the Abu Dhabi government’s principal vehicles to fast-track efforts to diversify the oil-dependent economy. There are unconfirmed rumours that the sovereign fund of Egypt will join ADQ's bid for Amoun.

Amoun is an Egyptian closed joint-stock company established in 1998 by Tharwat Bassily, who sold it in 2006 for $450 million to a group of investors including Capital Group, Concord International Investments, and the Rohatyn Group. The Group sold its shares to Bausch in 2014.

 

Taaleem Management Services: The player in the higher-education market with two brand universities under its umbrella made its debut on the stock market yesterday. Shares of the company started trading on the Egyptian Stock Exchange only days after its initial public offering, through which it raised LE2 billion, had ended.

The offering included selling 49 per cent of the company's shares to both institutional and retail investors. With very few traded shares in the education sector, shares in Taaleem were snatched up by retail investors, with the offering dedicated to them comprising only 2.45 per cent of the overall issue and 29 times oversubscribed at a price of LE5.75 per share. Meanwhile, the part earmarked for institutional investors was 2.34 times oversubscribed and ended up with 340 million shares in the company, representing 46.55 per cent of its equity, in the hands of private local institutions and high-quality investors from the Gulf, Europe, and Africa. 

Taaleem was launched in 2015 and owns and operates Nahda University in Beni Suef (NUB), where it has two campuses. With a capacity of 11,000 students, Nahda is the largest private university in Upper Egypt and focuses on health sciences, including medicine, pharmacy, dentistry, and physiotherapy. In 2018, it signed a partnership agreement with the internationally ranked Medical University to develop the Faculty of Medicine at NUB. According to its Website, Taaleem has invested LE1 billion in NUB over the last six years.

The company is currently working on launching Badya University in West Cairo with a potential capacity of 9,200 students. Taaleem recorded a net profit of LE144 million in 2019-2020, up from the LE110 million it realised in the previous year.

 

Integrated Diagnostics Holdings (IDH): The owner of both the Al-Borg and the Al-Mokhtabar labs is tapping the local stock exchange. The company, already listed on the London Stock Exchange since 2015, wants to list only five per cent of its shares on the local bourse this month.

IDH, which offers medical diagnostics and radiology services, received approval last week from Egypt’s Financial Regulatory Authority to proceed with the transaction.

The listing will be the first of its kind in the market, as the company will only list the stake without offering shares for trading. The aim of the offering is to provide an opportunity for a wider base of potential investors to deal in the company's shares, improving liquidity and trading volume with increased participation from retail and institutional investors in Egypt and the region and other investors who are unable to trade shares in companies listed on the London Stock Exchange.

While no new shares are to be offered, the company's executives are on a roadshow to inform fund and portfolio managers of it as a potential investment opportunity in the future. IDH was established as a subsidiary of Abraaj Capital in 2008. It entered the Egyptian market through its acquisition of Al-Borg labs followed by its main competitor Al-Mokhtaber labs.     

IDH listed in London in 2015 when the offering was more than 11 times oversubscribed. It now has 452 branches under its management. In addition to Egypt, it also has activities in Jordan, Sudan, and Nigeria. According to the online news outlet Enterprise, IDH ran more than 30 million tests for seven million patients in 2019, the last year for which full financial data have been released.

The company's revenues in 2019 stood at LE2.2 billion.

 

*A version of this article appears in print in the 8 April, 2021 edition of Al-Ahram Weekly

 

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