The MENA IPO market registered a total of 23 IPOs, down 4% YoY, in the first six months of 2023 (H1). All the IPOs were in the GCC with total proceeds of $5.2 billion, global accounting firm EY said in a report.

The MENA region has a promising pipeline for the rest of the year, particularly from Saudi Arabia, the report stated, which added that 23 Saudi companies have so far announced their listing plans on the Tadawul for H2 2023.

Two companies in Egypt intend to list, indicating a strong pipeline of IPOs to come in the remainder of the year.

Gregory Hughes, EY MENA IPO and Transaction Diligence Leader, said: “The MENA IPO pipeline for H2 2023 and 2024 remains very healthy with several IPOs already announced in KSA and multiple processes ongoing across the broader region, with further transactions planned in the UAE, Oman, Qatar, and Kuwait."

"We see planned IPO activity across different sectors and from a combination of family business, state-backed enterprise and private equity stakeholders," Hughes added.

IPOs gather momentum in Q2

Bucking the global trend, IPO activity in the MENA region continued to gather momentum with a total of $1.8 billion in proceeds from 13 IPOs in Q2 2023, EY stated in the report.

There was an increase of 44% in the number of listings but an 80% drop in proceeds when compared to Q2 2022. The UAE and Saudi Arabia continue to be the most active markets in the MENA region in terms of both the number and size of IPOs, the report stated.  

Brad Watson, EY MENA Strategy and Transactions Leader, said: "The MENA region continues to have strong economies and low debt; coupled with the reform and deregulation in the region, it continues to be an attractive environment for new listings.”

Saudi Arabia dominated the region’s IPO activity in terms of the number of listings in Q2 2023, with four listings on the Tadawul main market raising $800 million and seven IPOs on the Tadawul (Nomu) parallel market with proceeds of $100 million.

Jamjoom Pharmaceuticals Factory Company raised $336 million, the highest raise on the Tadawul for the quarter, followed by First Milling Company SJSC, which raised $266.4 million. Both offered a free float of 30% of the company’s share capital and were oversubscribed.

In the UAE, the Abu Dhabi Securities Exchange (ADX) completed their largest IPO of the quarter with ADNOC L&S raising $769.5 million. The IPO saw the largest demand globally for a transaction so far in 2023, with an oversubscription level of 163x in aggregate - the highest oversubscription for a UAE book-build IPO.

On the Dubai Financial Market (DFM), Al Ansari Financial Services PJSC was the UAE’s first family-owned company to be listed, raising US$210.4m in proceeds.

(Writing by Seban Scaria; editing by Daniel Luiz)