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Thursday, 31 October 2019

Rameda announces intention to IPO in 4Q2019

IPO WATCH- Rameda announces intention to IPO in 4Q2019: Rameda Pharma, the country’s fastest-growing generic pharmaceuticals player, announced yesterday morning its intention to sell an undisclosed number of shares in an initial public offering on the EGX in 4Q2019. The company is planning an offering to institutional and international investors as well as a retail offering. The value of the offering was not disclosed.

Rameda would be the second company to go public on the EGX in 2019 after Fawry made its trading debut in August.

Who’s selling? According to the ITF (pdf), Greville Investing is the selling shareholder.

Use of proceeds: Greville will reinject a portion of its proceeds from the transaction to subscribe to at least EGP 650 mn in newly-issued shares. Rameda plans to use the injection to fund operational expansions, with options on the table including the acquisition of new molecules and, potentially, the “opportunistic acquisition of pharmaceutical companies.” Rameda CEO Amr Morsy said the company look forward to further expand and continue growing across Egypt and the Middle East, noting that Rameda plans to introduce new products in Egypt and work on new export markets.

The financials: Rameda’s revenues for FY2018 grew about 27% y-o-y to EGP 805.2 mn, giving it a 2016-18 revenue CAGR of about 43%; adjusted EBITDA grew at a CAGR of about 67% in the same period. Profits last year stood at EGP 129 mn, up from EGP 89 mn the previous year and EGP 27 mn in 2016.

Background: Rameda is formally the Tenth of Ramadan for Pharmaceutical Industries and Diagnostic Reagents SAE. The company was one of at least three Egyptian companies believed to have pulled IPOs after the emerging market meltdown in the second half of last year.

Advisers: HSBC and Investec are joint global coordinators and bookrunners for the international offering, while CI Capital is joint bookrunner. Inktank is investor relations advisor.

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