Atta Africa Financial Update

Executive summary: Learning

Where governments are unable to provide youngsters with a decent education, the private sector in Africa is stepping up to the challenge.

In the developed world private schools charge high fees and teach the elite - in numbers taken a few years ago, there were an estimated 1 million private schools in the developing world - some are run by charities and churches, and others rely on state subsidies. But the fastest-growing group are small low-cost schools, run by entrepreneurs in poor areas that cater to those living on less than US$2 a day.

One reason for the developing world’s boom in private education is that aspirational parents are increasingly seeking alternatives to dismal state schools - in Africa, one-third of children who have finished four years of school cannot read at the minimum expected standard. Given the choice between a free state school where little teaching happens and a private school where their children have a chance to learn meaningfully, parents who can scrape together the fees will seek the latter.

A promising development is the spread of low-cost for-profit school chains in big cities in Africa - some started by catering to better-off families and are now moving into the mass market. Bridge International Academies for example, which runs around 400 primary schools in Kenya and Uganda, and plans to open more in Nigeria and India, is the biggest, with backers including Facebook’s chief executive, Mark Zuckerberg, and Bill Gates.

Kukula and eVa back DotCom Zambia with US$500k

  • Kukula Capital, the Zambian venture capital investor and eVentures Africa, the Dutch venture capital fund focused on ecommerce opportunities in Africa agreed to back Dot Com Zambia with US$500k in a combined equity and debt deal last week
  • Additional terms of the deal were not disclosed

Brait announced plans to raise £350 million (US$541 million) convertible bond

  • Brait have announced the launch of an offering of £350 million (US$541 million) of unsubordinated, unsecured convertible bonds due in 2020
  • The Bonds will be issued at par and are expected to carry a coupon of between 2.25% and 2.75% per annum payable semi-annually in arrears
  • The initial conversion price is expected to be set at a premium between 30% and 35% above the volume-weighted average price of the Ordinary Shares on the Johannesburg Stock Exchange
  • The capital will be used to boost its acquisition war chest