Top of the class: MJQE on track to put education sector on bourse

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MJQE founder, chairman and CEO Mengly J Quach. MJQE

Wholly locally owned Mengly J Quach Education Plc (MJQE) is moving ahead with plans to go public on the Cambodia Securities Exchange (CSX), to raise funds to expand its business and reach its goal of 160 active campuses. The initial public offering (IPO) would mark the education sector’s debut on the bourse.

Mengly J Quach, the founder, chairman, CEO and namesake of MJQE, an umbrella for Aii Language Centers (Aii) and American Intercon Schools (AIS), told The Post that previous plans to go public were derailed in 2019 amid “kind of bad” economic signs.

 

And then Covid-19 arrived, forcing MJQE to keep its IPO ambitions on hold until it determined that the pandemic storm had cleared, he rued.

Mengly stressed that Cambodia was “very lucky” that the government moved as early as it did to allow for the return to the full functioning of the economy, which he said “invited” foreign visitors back as Covid-19 restrictions eased.

Although 2023 is an election year, in which businesses typically pull the reins in on expansion plans, Mengly thinks that now – before the general vote – is the “right time” to go public on the CSX’s Main Board, “as we believe in our growth as well as in the support from clients, the parents [of our students] and investors”.

And in a purported gesture of confidence that stability in Cambodia can be preserved even during the election season, he proclaimed: “We’re still doing business as usual.”

He claimed that MJQE conforms to “all government requirements”, and that it has been compliant with requisites to list on the CSX for more than seven years.

The IPO will generate publicity for our schools and allow people to be part of MJQE, he said, predicting that the majority of those who purchase shares in the company will be parents of school-aged children.

 

“One of the main purposes will be to raise funds to open more schools and reach areas where there is demand – we have over a hundred schools to go, right now we only have 15 campuses,” Mengly added.

The websites of Aii and AIS show that they have seven and eight campuses, respectively.

CSX CEO Hong Sok Hour confirmed to The Post that MJQE has begun submitting the requisite documents for a listing eligibility review, and plans to finish doing so within the month.

MJQE’s ceremonial bell-ringing during the IPO will signal to other firms that the capital market is a new, “next-level” financing source for business expansions, he claimed, adding that news of the potential listing has created quite a buzz among the general public.

Meanwhile, elaborating further on stock-listing plans, Mengly revealed that as many as three public offerings are on the table, with MJQE expected to float a stake of between six and 10 per cent in its IPO.

But in the event of stronger-than-anticipated demand, Mengly expressed his keenness to seek approval for a larger quantum of shares in the initial offering, but indicated a cap of 20 per cent.

Although commenting that the IPO final offering price will be determined in the third week January, he predicted the price is ranged between 2000 riels to 6000 riels and subject to approval.

“It won’t be expensive – it’ll be quite reasonable, making it affordable and available for all Cambodians.”

For reference, according to the CSX website, major requirements to list on the Main Board are: respective minimums of – 30 billion riel of shareholder’s equity; two billion riel of net profit for the latest year and three billion riel for the latest two years; two full years of audited financial reports; and 200 shareholders possessing seven per cent of total voting shares.