Itqan Capital Signs an MoU with D3 Consulting
Aiming to Support Investment Growth in the Private Education Sector
Jeddah, Kingdom of Saudi Arabia – October 22nd, 2013: Itqan Capital, a pioneer in providing investment offerings to High Net Worth Individuals and Family Offices in the Kingdom of Saudi Arabia and a member of Al Baraka Banking Group, signed a Memorandum of Understanding (MoU) with D3 Consultants Co, a premier school consultancy company, specializing in the establishment, evaluation, and management of schools in addition to consultancy in international accreditation.
This was achieved through the participation of Itqan Capital as one of the main sponsor of the MENA Education Conference which was held in Dubai from 21st-23rd of October 2013.
The two companies aim to ink a partnership that will bring forth a number of educational projects in the GCC and MENA through a Sharia compliant private equity fund that specializes entirely in the primary education sector.
Eng. Abdulaziz Al Yamani, Chairman of Itqan Capital, said “The demand for education is of interest to citizens and governments alike in the region, which is supported by the population growth as well as the rising awareness of Arab communities and the improvement of living standards and disposable income. These key factors together encourage investment in education sector at all levels.”
Adil Dahlawi, Managing Director and CEO of Itqan Capital, also explained “The dramatic growth of private sector participation within the education sector in the last few years and the encouragement of governments towards a wider involvement of the private education providers, has led to the growth of private equity investments in the sector between 2005 and 2009 where US$ 275 million were reportedly invested through 13 acquisitions. It should be noted that Saudi Arabia is considered the largest market for education services in the GCC representing 75% of the region’s total students lay, where 75% of these students reside in three major cities of KSA, namely; Riyadh, Jeddah and Dammam.”
Mr. Dahlawi further explained “The GDP per capita in the region is expected to grow at a compound annual growth rate of 2.6% between 2011 and 2016. This increase in income levels of all individuals will have a direct impact on spending trends of the middle class in particular, and potentially driving increased spending on education. The rate of students enrolled in private schools is also expected to grow during that same period from 24% to 32% until 2016 for the entire GCC, which will lead to an increase in the number of private schools during that same period by about 1.6%.”
A study has also revealed that the number of male and female students in GCC will rise to 11.3 million while the number of higher education students will increase by 5.5% to reach 1.9 million students by 2020. This increase will therefore provide great opportunities for investors looking to benefit from this sector on the long-term.
Adnan Yousef, CEO of Al Baraka Banking Group, commented “The educational sector provides a promising investment opportunity that will entice the private sector to channel more their investments, and Itqan Capital will play a vital role through the creation of lucrative investment opportunities for the GCC and Saudi investors in particular, which is of great importance in the development of this vital sector and an effective contribution to improving the quality of primary education in the region.”
The GCC’s private school market is considered to be one of the biggest in the world as there are approximately 2.3 million male and female students registered in nearly 4,400 private schools, whereas public schools maintain nearly 7 million male and female students in 35,000 schools, majority of which are in the Kingdom of Saudi Arabia. It is important to note that the size of the GCC’s education market is estimated at $40 Billion US dollars, of which 14% represents private education.
Mr. Hany Al Sayed Hussein, Head of Asset Management at Itqan Capital, has given a joint presentation with D3 covering the education sector and how to overcome the challenges of investing in the sector. He also participated in the subsequent discussion panel, which dealt with feasibility studies for investments in early primary education and vocational training as the primary attractions for investors.