CURRO Holdings, the private education company, has raised more than R470m via a rights issue, giving it additional firepower to fund growth.

The group, which planned to transfer its listing from the JSE's alternative exchange to the main board on Monday, originally aimed to have 40 schools by 2020 but has not ruled out having double that number by then.

Curro, which is majority owned by PSG Group, the investment holding company, is exploiting a growing demand for private education in South Africa.

Parents' are concerned about the perceived poor quality of government schools that are overcrowded or lacking qualified teachers.

The rights issue by Curro - its second since it was listed a year ago - was meant to strengthen its balance sheet. It has also used debt to fund growth.

The issue has raised R477m, which includes R130m received from a private placement with black-owned investment company Thembeka Capital.

Chris van der Merwe, CEO of Curro, said on Monday he never doubted the rights issue would succeed because investors had bought into the company's vision of becoming a key player in the private education sector.

Major rivals include JSE-listed AdvTech, whose brands include Crawford Schools and Varsity College.

Dr van der Merwe said Curro was now building five schools that would open in January next year, to add to its existing 21 schools.

He added that the group was also considering "a couple of acquisitions", but did not provide details because Curro had signed non-disclosure agreements with the owners of the schools.

Piet Mouton, CEO of PSG, said the Stellenbosch-based investment group was "betting on the right horse" by investing in Curro.

He said PSG expected Curro to become as successful as Capitec, its 34,2%-controlled bank, which is now the fifth-largest retail bank by market share.

"The business model is good, especially when you look at the need for (quality) schooling," said Mr Mouton, adding: "We have a great horse we are backing."

Dr van der Merwe said it had been decided to move Curro to the JSE's main board because large institutional investors were more comfortable investing in a company listed on the main board.

"We have grown much faster than we anticipated and at this stage, with our market capitalisation of R2,8bn, we feel we have outgrown AltX," he said.

kamhungas@bdfm.co.za