IPO WATCH- CIRA announces plans to list 37.48% stake on the EGX: Leading private-sector education outfit Cairo Investment and Real Estate Development (CIRA) announced yesterday it plans to sell 207.3 mn ordinary shares, or 37.48% of the company, on the EGX. The transaction will include both an international private placement and a retail offering here in Egypt, according to the company’s intention to float (pdf). Selling shareholders will reinject a portion of the proceeds from the transaction into the company to fuel growth plans. “Our aim is to utilize the IPO to further enhance our robust growth plan in both higher education and the K-12 segments with a wider geographic footprint and versatile offering that builds on the current societal needs both on and off campus,” said CEO Mohamed El Kalla. The company is currently working on fulfilling “minor requirements” set by the Financial Regulator Authority to finalize registration and listing procedures for its return to the EGX. Sources had said earlier this week that the transaction could come as early as September.

Background: CIRA’s top line clocked in at around EGP 488 mn in the first nine months of 2018, and the margins are mouth-watering: 53% on the EBITDA line and nearly 34% at the bottom line. The company’s business model is unique, offering K-12 and post-secondary educations specifically to mobile middle-class families with a sharp emphasis on de-fanging the usual educational bureaucracy through technology. Readers will recognize brands including Badr University as well as K-12 schools including Futures, Rising Stars and Mavericks. The ITF (linked above) has chapter and verse on the company, its business model and future strategy. CIRA had previously counted Abraaj as an investor, but the Kalla family bought-out the one-time private equity titan earlier this year before Abraaj’s implosion.

Advisers: EFG Hermes is sole global coordinator and bookrunner for the transaction. White & Case is international legal counsel to the issuer, while Al Tamimi & Co. is acting as local counsel, and Zulficar & Partners is domestic counsel to the underwriter. Gide Loyrette Nouel LLP is serving as international counsel to the global coordinator and bookrunner. Inktank Communications is serving as investor relations advisor to the issuer.