Newly fortified Citadel looks to the future

Citadel Capital has sealed a successful rights issue, leaving the business well-positioned to capitalise on opportunities in the MENA region, according to co-founder Hisham El-Khazindar (pictured).

Citadel Capital has successfully completed a rights issue which has netted the Cairo-listed private equity group EGP 1.05 billion ($175.6 million ; €127 million), it said in a statement.

In addition, the group and its portfolio companies have raised $319 million in debt and equity since January this year. Hisham El-Khazindar, managing director and co-founder of Citadel, estimated Citadel’s war chest now stood at about $200 million in deployable capital, which he said left the business well-positioned to both weather further economic turmoil and capitalise on investment opportunities in the MENA region.

It provides us with the flexibility to more rapidly grow our existing portfolio or to pursue compelling new opportunities

Ahmed Heikal

Ahmed Heikal, the group’s chairman and other co-founder, said in a statement: “We see this as opportunity capital: it is more than sufficient to ensure our 19 existing platform companies weather any additional economic headwinds — and in the event of an improving business climate, it provides us with the flexibility to more rapidly grow our existing portfolio or to pursue compelling new opportunities of multiple forms. Throughout, we will remain very cautious.”

Shareholders subscribed to 210 million new shared at a par value of EGP 5 each, Citadel said. Investors include the International Finance Corporation, the African Development Bank, Dutch development bank FMO, German development finance institution DEG, the European Investment Bank, France’s PROPARCO, Belgium’s BIO, Equity Bank of Kenya and the ICF Debt Pool, the group said.

Earlier this year, discussions with regional peer Abraaj Capital over a potential buyout of Citadel broke down. At the time, Citadel said in a statement: “The parties did not reach agreement on terms that would — in the view of Citadel and of its advisors, Citigroup — maximise value for all Citadel Capital shareholders equally, and adequately protect the interests of the firm’s stakeholders and co-investors.”