Saudi Sovereign Wealth Fund Makes Historic Offer to Acquire Sera Education Company: Positive Outlook for Egypt’s Economy

United Arab Emirates Dubai (CNN). This is the first takeover offer submitted by the Fund since the decision to free the exchange rate of the pound against foreign currencies on March 7, while experts confirmed that the Fund’s offer is a sign of the positive outlook for the future economy of Egypt..

According to Sera Education’s statement to the Egyptian Stock Exchange, the offer of the Egyptian Saudi Investment Company includes the subscription of shares to increase the capital of Social Impact Capital Limited – which owns 51.21% of Sera Education’s shares – with Social Impact submitting a mandatory purchase offer of at least 75% for the purpose of merger and up to 100% of Sera Education shares at a price of 14 pounds ($0.29) per share, and an optional list of shares “Sera Education ” from the Egyptian Stock Exchange after completing the acquisition procedures..

The head of the Egyptian Securities Association, Mohamed Maher, said that the Saudi sovereign fund’s bid to acquire Sera Education Company confirms the fund’s positive outlook on the future of the Egyptian economy in general and the education sector in particular, and opens the door to attract more investments in the sector, whether from Arab investment funds or from specific foreign companies due to the rapid growth that characterizes the education sector in Egypt due to the increase large population and high demand for all levels of education.

Investment in the education sector in Egypt represents an attractive opportunity for companies and sovereign funds, due to the high demand, as students represent 31% of the total population of Egypt, and to there are 23 million students at the pre-university level of education, according to 2020 statistics.

Regarding the reason for the offer of the Saudi sovereign fund to acquire the Seera Company; Maher returned, in specific statements toCNN In Arabic, since this is one of the largest companies working in the education sector in Egypt and applies all the rules of management and transparency according to the Fund’s strategy it is expected that the acquisition agreement will be completed as the Fund has the necessary liquidity to finance the agreement, and the agreement with the main shareholder, Social Impact Company, before submitting the purchase offer..

In August 2022, the Saudi Public Investment Fund announced the launch of the Saudi Egyptian Investment Company, with the aim of capturing investment opportunities in the sectors of real estate development, healthcare, financial services, and food, agricultural and industrial projects Launched, the company has pumped investments worth $1.3 billion to acquire part of the state’s shares in Government companies, notably Abu Qir Fertilizers and Chemical Industries, Alexandria Container and Cargo Handling, Misr Fertilizer Production – MOPCO, and i-Finance for Financial and Digital Investments..

For his part, financial markets expert Hanan Ramses said that Saudi sovereign wealth funds are focusing their first investments after freeing the pound exchange rate on the education sector, due to the sector’s high demand, regardless of whether the interior as a result of the increase. in the population at the level of education or externally through the influx of many students..

According to Sera Education Company data for the Egyptian Stock Exchange, the company’s net profits decreased in the period between September and November 2023 to 104.6 million pounds ($2.2 million), compared to 112.1 million pounds ($2.4 million), compared to the same period in 2022. Due to the increase in general and administrative expenses, as well as net financing expenses.

Ramses added, in specific statements:CNN In Arabic, the Saudi sovereign wealth fund offer was positively reflected, whether on the performance of Sera Education shares in the first session of their submission of the offer, causing the stock to rise by more than 10%, or on the performance of the education services department on. the stock exchange, which increased by 8.5%, due to the optimism of investors in the stock market about the reception of the sector Investment will flow in the coming period from Arab investment funds.

Sera Education Company owns 27 pre-university schools, with a total number of students of 34,000. They also own a university in Badr Town where 20,000 students study..

Hanan Ramses agreed to the expectations of the implementation of the acquisition offer for Sera Education Company, and linked implementation to the price of the purchase offer submitted for Sera Education shares, explaining: “If it is higher than the market price of the share at the time If they submit the offer, the shareholders will accept to sell the shares, and if it is lower, they can pay..

According to the purchase offer submitted by the Saudi sovereign wealth fund, the fund will begin due diligence procedures to agree on the final price of the mandatory purchase offer for Sera Education Company, provided that it submits the offer after obtaining all regulatory approvals from all government and regulatory authorities..

A financial markets expert predicted that the voluntary listing of Sera Education Company would have an impact on the Egyptian Stock Exchange, due to the decline in market value compared to the total value of the t -stock exchange, which exceeded a trillion pounds. she called for the need to work to attract new companies to offer on the financial market, and proposed a dual registration to the Saudi sovereign fund for Seera on the Saudi and Egyptian stock exchanges.

According to Sera Education Company’s statement to the Egyptian Stock Exchange, the Saudi sovereign fund aims to buy the company to improve its regional presence and expand the scope of its services in Egypt and the Arab region.