Abraaj plans to sell stakes in Dubai campus to Amanat for $100 million

dubai — Abraaj Group, the buyout fund that’s undergoing a court-supervised restructuring, reached an agreement to sell its stake in Middlesex University’s Dubai campus to Amanat Holdings PJSC for about $100 million, people with knowledge of the matter said.

An initial agreement has been signed and the deal is yet to close, the people said, asking not to be identified because the information is private. Dubai-based Amanat would own all of the UK-based university’s campus, which had annual revenue of about $40 million, one of the people said.

Spokespeople for Dubai-based 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 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 who is selling it at what I see as a discount,” said Issam Kassabieh, senior financial analyst at Mena Corp. 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 most influential buyout firms. The move comes after investors, including the Bill & Melinda Gates Foundation, commissioned an audit to investigate the alleged mismanagement of funds.

Amanat, which owns 35 percent in Abu Dhabi University Holding Co and 21.7 per cent in Taaleem Holdings, is seeking to expand its presence in the Middle East education sector. The company has about Dh1.8 billions ($490 million) to spend on 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 over 100 nations. It offers undergraduate and postgraduate programs in a wide range of subjects.