Abraaj Group, the buyout fund in the midst of a court-supervised restructuring, has agreed to sell its stake in Middlesex University's Dubai campus to Amanat for about $100 million, sources said.
An initial agreement has been signed but the deal is yet to close, the sources said. Dubai-based Amanat would own all of the UK-based university's campus, which generated annual revenues of about $40m, one of the sources said.
Abraaj and Amanat declined to comment.
Amanat shares climbed as much as 3.9 per cent in Dubai before paring gains to 1.6 per cent at 11.30am Gulf time. The shares were poised for their biggest increase in more than a month. Dubai’s main stock gauge declined as much as 1.2 per cent.
“The acquisition of Middlesex came in at a really good time for Amanat and a terrible time for Abraaj, which is selling it at what I see as a discount,” said Issam Kassabieh, senior financial analyst at Mena in Dubai. “The stock movement indicates investors are happy with the company moving forward with its acquisition and it’s definitely a big plus to diversify their portfolio further.”
A court in the Cayman Islands last week appointed provisional liquidators for the holdings and investment management units of Abraaj, which was once one of the developing world's leading buyout firms. The move came after investors, including the Bill & Melinda Gates Foundation, commissioned an audit to investigate alleged mismanagement of funds.
Amanat, which owns 35 per cent of Abu Dhabi University Holding and has 21.7 per cent in Taaleem Holdings, is seeking to expand its presence in the Middle East education sector. The company has about $490m for acquisitions in healthcare and education, managing director Shamsheer Vayalil said in December.
The Dubai Middlesex campus opened in January 2005 and has more than 3,000 students from 100 or more nations. It offers undergraduate and postgraduate programmes in a wide range of subjects.