GCC 2018 IPO performance
In the GCC, 18 deals were recorded in 2018 with a total value of US$2,564.6m. Saudi Arabia led IPO activity in 2018 with 12 IPOs worth US$1,472.4m.
MENA IPO performance in Q4 2018
In the fourth quarter of 2018, the MENA region witnessed seven IPOs, of which one was a REIT listing, for a total deal value of US$1,085.1m.
Saudi Arabia lists two IPOs in Q4 2018, plans for privatization of companies
Saudi Arabia witnessed two IPOs in Q4 2018, including Alkhabeer REIT which raised US$64.1m and the National Company for Learning & Education which raised US$66.7m. Tadawul is working on several initiatives including launching stock index futures (planned for Q1 2019) and launching a special incentive program for local companies to list.
The country is also planning the privatization of more than 20 companies in 2019 in sectors such as water, agriculture, energy, and sports. To help increase transparency, the government plans to retain minority interests in the businesses and undertake IPOs and other transactions for a certain percentage of each asset.
Bahrain sees its most successful IPO; GCC stock markets plan for 2019
The Bahrain Stock Exchange saw the IPO of port operator APM Terminals in Q4 2018 raise US$32m. The IPO was oversubscribed by 5.4 times, making it the most successful IPO in Bahrain in over a decade.
Nasdaq Dubai plans to launch futures trading on the MSCI United Arab Emirates equity index in 2019 to provide investors a new avenue to gain exposure to UAE companies.
In Kuwait, S&P has issued a statement that the country will be added to the S&P Dow Jones Global Benchmark Indices with an emerging market classification in 2019. The Kuwait Stock Exchange is currently awaiting MSCI’s decision in 2019 on upgrading the exchange to emerging market status from the current frontier market status.
Gregory Hughes, MENA IPO Leader, EY says:
“While the interest from several companies across the MENA region to execute an IPO is high, especially for those looking to access international investors and exchanges, many plans have been delayed for numerous reasons, including underperformance of businesses due to the challenging economic environment, global market volatility, and the time it takes to adapt to public company listing requirements. We continue to work with many companies in preparation for transactions in 2019 and beyond, particularly from the United Arab Emirates, Saudi Arabia, and Egypt.”
North Africa sees three IPO listings in Q4 2018
In the wider MENA region, Egypt, Morocco, and Algeria recorded one deal each amounting to a total value of US$176.7m. The IPO of Sarwa Capital on the Egyptian Stock Exchange raised US$123.2m during Q4 2018. The government of Egypt delayed the sell-off of a 4.5% stake in the state-owned Eastern Tobacco Company owing to market volatility. Many private IPOs tentatively planned for the quarter were also pushed to 2019 citing market volatility.
In Morocco, the IPO of Mutandis SCA raised US$44.0m in Q4, making it the second IPO in 2018 on the Casablanca Stock Exchange.
The Algiers Stock Exchange witnessed the first SME to introduce its capital on the stock market, with the IPO of AOM Invest Spa raising US$9.5m during Q4 2018. The Algiers Stock Exchange has opened the SME segment as part of the financial market’s modernization project, with the objective of increasing its contribution to the mobilization of savings and the financing of the economy.
Global IPO Activity
Globally, IPO activity continued to slowdown in Q4 2018, with 326 IPOs raising US$53.7b, marking a decrease of 34% and 10% respectively, compared to Q4 2017.
EY | Assurance | Tax | Transactions | Advisory
EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.
EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com.
The MENA practice of EY has been operating in the region since 1923. For over 90 years, we have grown to over 7,500 people united across 21 offices and 16 countries, sharing the same values and an unwavering commitment to quality. As an organization, we continue to develop outstanding leaders who deliver exceptional services to our clients and who contribute to our communities. We are proud of our accomplishments over the years, reaffirming our position as the largest and most established professional services organization in the region.
© 2019 Ernst & Young.
All Rights Reserved.
Follow us on Twitter @ey_mena
MENA Public Relations
+971 4 332 4000
MENA Public Relations
+971 4 332 4000
© Press Release 2019