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Abraaj Group raises LE360 m via IPO of Cleopatra Hospital on EGX

Abraaj Group raises LE360 m via IPO of Cleopatra Hospital on EGX

Arab Finance: The Abraaj Group (‘Abraaj’ or the ‘Group’), a leading investor operating in global growth markets, today announced that it raised EGP 360 million in capital for its partner company Cleopatra Hospital Company S.A.E. (the ‘Company’) through an initial public offering (‘IPO’) on the Egyptian Exchange (‘EGX’). 80% of the outstanding shares of the Company continue to be retained by Funds advised by Abraaj.

The listing of the Company marks the second IPO of 2016 on the Egyptian Exchange. The IPO was more than 28 times oversubscribed on the retail tranche offering and more than six times oversubscribed on the institutional tranche, with over 65% of the orders coming from international investors. The IPO price of EGP 9 per share will give the Company a market capitalization of EGP 1.44 billion at the opening bell today. The Abraaj Group's Funds will use the proceeds of the IPO to subscribe to an exclusive capital increase to fuel future growth.

Cleopatra Hospital Company S.A.E. is the largest private hospital group in Egypt both by number of hospital beds and operational hospitals. The Abraaj Group invested in the Company through its Funds in 2014, in partnership with leading global development finance institutions, 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 S.A. (‘Proparco’).

Commenting on today’s announcement, Ahmed Badreldin, Partner at The Abraaj Group and Vice Chairman of Cleopatra Hospital Company, said: “This IPO reflects the renewed, strong investor confidence in the capital markets and healthcare sector in Egypt. During the first phase of our investment in the Company, we focused on creating scale by acquiring hospitals in attractive catchment areas of Cairo. We view this IPO as the beginning of the second phase of the Company’s expansion, both in terms of reach within Cairo and across other governorates, and in scale through the addition of more hospital beds and rollout of ambulatory clinics to provide quality healthcare services across Egypt.”

Walid Bakr, Managing Director at The Abraaj Group, added: “Abraaj and Cleopatra Hospital Company have a shared vision of offering accessible, affordable and quality patient care. As the founding investor and long-term partner of the Company, we have worked with management to enhance operating efficiencies through centralized initiatives as well as embarking on projects for both hospital infrastructure and medical technology upgrades. The success of the IPO validates the Company’s strong performance to date and we look forward to working closely with the management team to deliver on future expansion plans”.

Commenting on the IPO, Dr Ahmed Ezzeldin, Chief Executive Officer of Cleopatra Hospital Company, said: “Abraaj’s investment has consolidated our standing as the leading private hospital group in Egypt and helped us redefine the standard for high-quality healthcare delivery in the country. The listing on EGX provides us with an exciting new platform for the next phase of our growth. We look forward to widening our footprint both in and outside Cairo and maintaining our focus on delivering high quality and accessible care”.

EFG Hermes Promoting and Underwriting was Sole Global Coordinator and Bookrunner for the IPO. Zulficar & Partners were local counsel to the Company while Freshfields Bruckhaus Deringer LLP was international counsel. Matouk Bassiouny served as local counsel to the Sole Global Coordinator and Bookrunner while Shearman & Sterling (London) LLP was international counsel.

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