Curro Plans $124 Million Fundraising for South African SchoolsJohn Bowker
Curro Holdings Ltd., an operator of private schools in South Africa, plans to raise 1.44 billion rand ($124 million) from debt markets and a rights issue as it seeks to develop new institutions and explore potential acquisitions.
Shareholders will be offered the right to buy one share for every 11 they already own at 25 rand each, the Cape Town-based company said in a statement on Tuesday. The stock closed at 33.14 rand the previous day. About 740 million rand will be raised from the rights issue and a further 700 million rand from debt markets.
“Curro has achieved its prelisting objective of at least 40 campuses five years ahead of its original target of 2020,” the company said. “In 2015, Curro plans to invest approximately 600 million rand on the expansion of existing campuses.”
South Africa’s education system was ranked the fifth-worst among 144 countries in a survey by the World Economic Forum last year, increasing the attraction of private schooling for those that can afford it. The school pass rate for final-year students fell for the first time in five years in 2014 after changes to the curriculum system.
Net income gained 48 percent to 55 million rand in 2014, Curro said. Sales increased 52 percent to 1 billion rand. The shares have advanced 14 percent this year, valuing the company at 10.8 billion rand.