MENA markets saw 48 initial public offerings (IPOs) in 2023, raising $10.7bn in total, according to the EY MENA IPO Eye Q4 2023 report.
The report indicated that during Q4 2023, 19 IPOs raised $4.9bn in proceeds.
It added that all Q4 listing activity took place in the GCC region, with Egypt being the only non-GCC country that reported IPOs throughout 2023.
ADES Holding Company raised the most funds and contributed 25% of the overall IPO proceeds in the last quarter, followed by Pure Health Holding PJSC with 20%.
Five listings, mainly in the energy and logistics sectors, contributed 58% towards the total IPO proceeds raised in 2023.
Investor confidence in the region continues, with 11 out of the 19 Q4 2023 IPOs recording a first-day gain in share price. At the end of 2023, 26 out of the 48 IPOs showed a positive return compared to their listing price, with Armah Sports Company achieving the highest gain at 72%.
Moreover, the EY report said that last year recorded a 6% decrease in the number of IPOs and a 51% drop in proceeds, compared to 2022. Notably, 2022 witnessed a significant number of IPOs, such as Americana Restaurants International PLC (Americana), Saudi Aramco Base Oil Company (Luberef) and Arabian Drilling Company, which played a role in the decline seen in 2023.
The 2024 pipeline includes 29 companies across various sectors announcing their intention to list, with the Kingdom of Saudi Arabia (KSA) and the United Arab Emirates (UAE) leading the way in terms of expected volumes. Outside the GCC, Egypt has four IPOs planned.
Brad Watson, EY MENA Strategy and Transactions Leader, said:
“In 2023, there were a total of 48 IPOs raising US$10.7bn, of which five listed companies contributed 58% toward the total IPO proceeds raised, mainly in the energy and logistics sectors. Investor confidence in the region continues with 11 out of the 19 Q4 2023 IPOs recording a first-day gain in share price.”
He added that the 2024 pipeline includes 29 companies across various sectors, announcing their intention to list with the KSA and the UAE leading the way in terms of expected volumes.
Saudi Arabia continues to dominate listings
Once again, KSA reaffirmed its dominance in terms of IPO activity in the region with 14 of the 19 listings in Q4 2023, the report indicated.
“ADES Holding Company marked the highest proceeds at $1.2bn, followed by SAL Saudi Logistics Services Company at $0.7bn. Both IPOs were listed on the Tadawul Main Market. The remaining 12 IPOs, raising $140m in total, took place on the Nomu – Parallel Market, which also witnessed the quarter’s only direct listing in the MENA region – Almujtama Alraida Medical Co.
In 2023, the country’s IPOs came from a variety of sectors, led by energy (36%), transportation (29%) and healthcare (10%).
Q1 2024 kicked off with two Saudi listings on Tadawul in January – MBC Group, raising $222m, and Avalon Pharma, raising $437m.
Gregory Hughes, EY MENA IPO and Transaction Diligence Leader, said:
“As expected, 2024 started positively with the MBC listing, Avalon Pharma and the announcements of several IPOs on the MENA markets including large private and state-owned names.”
UAE reports four new listings
Abu Dhabi Securities Exchange (ADX) welcomed three IPOs in Q4 2023, raising a combined total of $1.8bn. These included Pure Health Holding PJSC, valued at $987m, Investcorp Capital plc at $451m and Phoenix Group PLC at $371m. Pure Health Holding PJSC reported the highest first-day gain of 76%. In addition, there was one new listing in the transportation sector on the Dubai Financial Market (DFM) – Dubai Taxi Company PJSC, worth $315m.
Oman records its largest IPO to date
The Muscat Stock Exchange (MSX) saw the largest IPO in Oman to date with OQ Gas Networks SAOC raising $772m. Meanwhile, Oman Investment Authority (OIA), the country’s sovereign wealth fund, is preparing to launch multiple IPOs and list state assets to strengthen its capital markets.
