Wednesday 27 / November / 2024
Muscat: The Mena region has witnessed a 288 per cent year-on-year increase in the number of companies listing during the first nine months of the year, raising $14.7 billion in total, up 550 per cent in the same period last year, according to a new report.
“The strong run across the region’s markets included seven IPOs in the third quarter of 2022, raising approximately $1.5 billion, bringing the total number of Middle East and North Africa (Mena) IPOs in the year-to-date 2022 to 31,” the latest EY Mena IPO Eye Q3 2022 report shows.
Globally, in the year-to-date, there have been a total of 992 initial public offerings (IPOs), raising $146 billion, a 44 per cent and 57 per cent decrease year-on-year respectively as companies and investors continue to face mounting macroeconomic challenges, market uncertainties, increasing volatility and falling global equity prices, the report added.
The Mena region, however, has generally bucked the global trend with IPO activity and pipeline continuing to remain strong despite the weaker global sentiment.
“Despite IPO volumes and values declining significantly in the majority of other global markets, the Mena region continues to forge its path with a steady stream of new listings in the third quarter (Q3) adding to the large number of IPOs already announced across exchanges in the year-to-date,” Brad Watson, EY Mena Strategy and Transactions Leader, said.
“While Saudi Arabia and the United Arab Emirates make up the majority of new listings, we are also seeing increased signs of future activity in some of the smaller markets of the region - particularly Kuwait, Oman and Qatar,” he added.
Saudi Arabia leads
The Kingdom of Saudi Arabia (KSA) dominated listings activity in Q3 with two IPOs on Tadawul’s Main Market and three IPOs on the Nomu-Parallel Market, raising $490 million in proceeds. Alamar Foods Company’s public offering was the largest, with $326 million raised and the IPO order book being oversubscribed approximately 48 times. Naqi Water Company raised $110 million and was oversubscribed over 30 times. The remaining three IPOs on the Nomu-Parallel Market saw Saudi Networkers Services, International Company for Human Resources and Naba Alsaha Medical Services Company raise approximately $54 million in total.
UAE IPOs
In the United Arab Emirates (UAE), Salik Company, Dubai’s exclusive tollgate operator, raised over $1 billion, becoming the largest Mena IPO during Q3 and the fourth largest in the region in the year-to-date 2022. The IPO was oversubscribed more than 49 times across all tranches with total gross demand at $50.2 billion.
IPO activity also returned to Morocco for the first time since last year, with Disty Technologies, a Moroccan IT company, raising approximately $17 million on the Casablanca Stock Exchange.
“This has been another strong year for IPOs and trading activity throughout the Mena region, with investor confidence remaining high despite challenging financial headwinds across the world. As we look into the fourth quarter, we see no signs of that changing, with several prominent companies in the region having completed their IPOs,” Gregory Hughes, EY Mena IPO and Transaction Diligence Leader said.
“We are also expecting increased activity in dual listings to tap varied liquidity pools; and continued government divestment processes in the UAE, Oman and other countries, as well as movement from family businesses, which are believed to be planning market entry in different parts of the region,” he added.
