During the first quarter of 2024, 10 initial public offerings (IPOs) across the MENA region raised a staggering $1.2 billion in proceeds, according to the latest ‘MENA IPO Eye‘ report from EY. Despite having the same number of IPOs compared to Q1 of 2023, MENA IPOs saw a 66 percent decline in proceeds.
Internationally, the IPO landscape has undergone notable changes. The total IPO proceeds globally reached $23.7 billion from 287 listings, a 7 percent annual increase. However, the activity by the number of IPOs saw a 7 percent annual decline due to a decline in the Asia-Pacific region’s activity.
The global IPO market is facing mounting challenges including geopolitical tensions, economic volatility and global elections, raising investor concerns as they attempt to navigate through these uncertainties.
Saudi Arabia dominates region’s IPO activity
Saudi Arabia emerged as the MENA region’s most active IPO market with nine out of 10 listings in Q1 2024, raising $724 million. The Modern Mills IPO raised the highest proceeds of $314 million in Saudi Arabia. Second came MBC Group with $222 million and Middle East Pharmaceutical Industries Company with $131 million.
The top three IPOs in Saudi Arabia were listed on Tadawul while the remaining six occurred on Nomu with total proceeds reaching $57 million. In Q1 of 2024, Saudi Arabia’s IPOs spanned across a variety of sectors including healthcare, food and beverages, and media and entertainment.
“The KSA continues to lead the pipeline activity for the MENA region, with several companies announcing their plans to list such as Saudi Manpower Solutions Company (SMASCO), Miahona, and Panda Retail Company,” stated Brad Watson, EY MENA Strategy and Transactions Leader.
UAE maintains IPO momentum
The UAE plays a pivotal role in supporting MENA IPOs. In Q1 of 2024, the Dubai Financial Market (DFM) welcomed its first listing, Parkin Company PJSC, which saw an oversubscription of 165 times, raising $0.4 billion in proceeds.
Parkin Company raised the highest proceeds in Q1 and contributed 37.2 percent of the overall proceeds of MENA IPOs, followed by Modern Mills Company, which contributed 27.3 percent.
“The successful IPO of Parkin Company PJSC on the DFM demonstrated the continued commitment toward the privatization program from the Dubai government to list state-owned companies,” stated Gregory Hughes, EY MENA IPO Leader.
Looking forward, the UAE also announced significant listings including Lulu Group and Etihad Airways. Retail chain Spinneys saw its opening day on the DFM on Thursday after a successful IPO.
Future MENA IPOs
An additional 25 private companies and 10 funds intend to list on the MENA exchanges in 2024, across various sectors. In the GCC, Lulu Group, Spinneys and Etihad Airways PJSC have declared their intention to list.
Meanwhile, in Saudi Arabia, Dr. Soliman Abdulkader Fakeeh Hospital Co, Miahona Company, and SMASCO have obtained approval from the CMA.
Outside the GCC region, Raya Information Technology in Egypt and Credit Populaire d’Algerie in Algeria have announced their IPOs.
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