EY: 10 GCC IPOs Raise $2.26bn In H1 2014

A total of 10 IPOs were issued in the GCC during the first half of this year, and together raised $2.26 billion, according to a report by EY.

The figures represent a 67 per cent rise in volumes and a 14 per cent hike in values as compared to the same period last year.

Saudi Arabia led the GCC activity with four IPOs, followed by the UAE with three, Oman with two and Qatar with one.

“The fundamentals of the Saudi economy along with the increased appetite for equities and improved valuation have contributed to a better IPO performance in the Kingdom,” the report said.

Overall, listings in the Gulf represented 90 per cent of all MENA IPOs in H1 2014, EY found.

Mayur Pau, MENA IPO leader, EY stated: “The regional IPO market has seen some notable developments in terms of new deals. Emirates REIT Ltd. was the first listing with a capital raise since 2008 on Nasdaq Dubai and Marka was the first IPO on DFM since 2009.

“The upgrading of the UAE to emerging markets status in May 2014 will go a long way towards changing investors’ perceptions and will help to boost the long-term prospects of the market.”

Across the MENA region, a total of 16 deals raised $2.4 billion in the first six months of the year, a year-on-year increase of 14 per cent for both volume and proceeds.

The first half of the year also saw the most capital raised and highest volume of IPOs since 2008, said EY.

In terms of sectors, activity was spread across the board, with IPOs in healthcare, power and utilities, retail, construction, oil and gas, telecommunications, leisure and tourism and industrial manufacturing sectors.

The region’s largest issue came from Qatar’s Mesaieed Petrochemical Holding Company, which raised $903 million in January 2014.

Phil Gandier, MENA Transactions leader, EY, said: “In the first half of the year, the majority of IPO deals were in Q2, which is a good indication for a positive second half of the year.

“All the IPOs executed in Q2 2014 were within the regional market which shows a shift from the trend of international listings in the last few quarters.

“With a solid pipeline of IPO-ready businesses across a broad range of geographic markets and from multiple sectors, strong investor confidence and expected “IPO friendly” regulatory and legal reforms in key markets, we expect an uptick of IPOs in the second half of 2014,” he added.