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MENA investment banking giant EFG Hermes has a pipeline of seven IPOs and is expecting a few accelerated book building (ABB) deals for the rest of 2025, after having raised $575.7 million from three public offers in Q1.
While the global investor community has been slammed by the market sell-off as Donald Trump pushes ahead with plans for aggressive tariffs on America’s largest trading partners, Mostafa Gad, Global Head of Investment Banking at EFG Hermes, said he would sit tight for the next two weeks, but May and June look very busy for the bank.
“It's [much too] early to decide whether to delay or cancel IPOs due to market uncertainty. The wise thing to do is to wait and monitor the markets. We may not launch anything in the next two weeks, but we have a very busy May and June,” Gad told Zawya.
The bank, which boasts an investment banking team of more than 50 and has offices in key markets such as Cairo, Dubai, Kuwait, Oman, and Riyadh, has scheduled five IPOs for Q2 and another two for the second half of the year.
“We have already executed three and have another seven IPOs to go. It is a diverse pipeline, with most of them from the private sector in Saudi and one from Kuwait in the fourth quarter,” Gad said.
Saudi Arabia is not heavily reliant on the government sector to drive the economy, Gad noted. “The kingdom has a very vibrant private sector that participates in the equity capital markets (ECM) and can make things happen even if the government slows down spending.”
Healthcare, consumer business, technology, and infrastructure have always been the core focus for EFG Hermes. In 2024, the investment bank led the ECM league table across the MENA region with a deal value of $19.7 billion from 17 deals.
While HSBC took first place in the MENA ECM underwriting league table during the first quarter of 2025 with a 24% market share, EFG Hermes followed with a 12% market share from three deals, including UAE’s AlphaData, Oman’s Asyad Shipping and an ABB deal for ADNOC Gas that raised $2.84 billion.
MENA equity and equity-related issuance totalled $4.7 billion during the first quarter of 2025, the highest first quarter total in the region since 2008. The number of issues increased 23% from year-ago levels. While IPOs accounted for 34% of activity, follow-on issuance accounted for 66%, LSEG data revealed.
A total of 12 IPOs were recorded in Q1 2025, three more than the same time last year. They raised a combined $1.6 billion, a 73% increase from last year.
According to Gad, the biggest advantage his team has is that it primarily focuses on Egypt and the key GCC markets. “Out of all the banks, both local and international, we have made the most investments in onshore presence. We have brokers and sales teams on the ground and the largest research team in the region compared to other banks,” he noted.
Last year, EFG Hermes helped raise $7.2 billion from 11 IPOs across Tadawul, ADX, DFM and Boursa Kuwait and $12.5 billion from six secondary offerings. The investment bank was part of Aramco's secondary offering, the largest follow-on offering (FMO) in the GCC, and a bookrunner for Saudi-based Nice One, which marked the first unicorn listing on Tadawul.
Focus on accelerated book building
EFG Hermes is confident of the scope of finding more accelerated book-building deals in the Saudi and UAE markets. The bank already enjoys a leading position when it comes to working on this ECM format of quickly raising funds by offering shares to institutional investors within a very short timeframe.
Besides the ABB deal for ADNOC Gas in February, the bank completed an ABB for ADNOC Drilling last year, which involved the sale of Helmerich & Payne’s full stake in the latter, valued at approximately $197 million.
It also helps corporates meet the criteria for inclusion in major stock indices.
“ABBs are ideal for corporates [looking] to enhance liquidity and onboard international investors who did not get a chance during the IPO to have a good allocation. By quickly raising capital and increasing the liquidity of shares, such deals facilitate index inclusion,” Gad said.
(Reporting by Seban Scaria; editing by Daniel Luiz)
