|31 July, 2019

PwC's GCC capital markets watch - Q2 2019

Slight pick up in IPO activity offers some optimism for GCC Markets 

USD 866m raised from IPOs in Q2 2019 across GCC, as compared to USD 463m in Q2 2018.
2 IPOs in Q2 2019, down from five IPOs in Q2 2018.
USD 12bn corporate bond issued by Saudi Aramco
Sukuk issuances continue to dominate GCC debt market; while Aramco’s mega bond issue leads GCC debt market to global limelight

Dubai: A slight increase in IPO activity marked the second quarter of this year, with two companies listing on Saudi Arabia’s Tadawul. Both the UAE’s promising pipeline and Tadawul stock exchange’s development offer some optimism for the GCC market. Despite this, GCC market activity continues to be slow with only two IPOs on Tadawul in Q2 2019, compared with five in the same quarter last year.

Meanwhile, GCC debt market activity was dominated by sukuk issuances this quarter, including sizeable issuances by the Emirate of Sharjah and Islamic Development Bank Trust Services Limited, raising USD 1bn and USD 1.5bn respectively on Nasdaq Dubai. This debt issuance activity is expected to continue to Saudi Arabia, which plans to issue USD 31.5 billion in debt this year to help fund government spending. And of course, Saudi Aramco’s bond issue was by and large the most prominent corporate transaction of the quarter, raising USD 12bn.

Steve Drake, PwC Middle East Capital Markets Partner, said: “Geopolitical uncertainty will continue to impact the regional economy. Recent events in the Gulf of Oman and ongoing Brexit uncertainties, among other more recent developments, are cutting the IPO windows even shorter. Companies looking to tap into the equity capital market should get themselves ready early and remain on standby, in order to maximise their chances of a successful IPO.”
He added: “The UAE Cabinet’s recent announcement of sectors and economic activities eligible for 100% foreign ownership is also expected to revitalise market activity in the UAE in the near future. Meanwhile in Saudi Arabia, activity on Tadawul is likely to continue to improve since the exchange and Saudi’s Capital Market Authority latest regulations allowing for GCC-wide cross-listing.”

GGC IPO performance to date

Tadawul and Boursa Kuwait stood out as the better performers, in the year to date, compared to Q2 2018; with the only two IPOs this quarter both listing on Saudi’s Tadawul - Arabian Centres Company and Maharan Human Resources Company.

Regional success story: Network International Holdings listing on the London Stock Exchange (LSE)
The record-breaking listing of UAE-based Network International in April this year, which PwC helped to deliver, represents the largest outbound IPO to date from the Middle East and Africa region, on any international stock exchange. The IPO opened a significant premium, valuing the business at over USD 3bn and making it the largest IPO on the LSE since June 2017.

For a full copy of the report please visit: https://www.pwc.com/me/capital-markets-watch 

– Ends –

About PwC’s GCC Capital Markets Watch
GCC Capital Markets Watch surveys IPOs on GCC’s principal stock exchanges and market segments as well as conventional bond and sukuk issuances on a quarterly basis. This survey was conducted between 1 April 2019 and 30 June 2019 and captures the relevant data based on their transaction date. GCC Capital Markets Watch is prepared by PwC Middle East (www.pwc.com/me). All market data is sourced from publicly available information and has not been independently verified by PwC.

About PwC
At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 158 countries with over 250,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com

Established in the Middle East for 40 years, PwC has 22 offices across 12 countries in the region with around 5,200 people. ( www.pwc.com/me ).

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

© Press Release 2019

Disclaimer: The contents of this press release was provided from an external third party provider. This website is not responsible for, and does not control, such external content. This content is provided on an “as is” and “as available” basis and has not been edited in any way. Neither this website nor our affiliates guarantee the accuracy of or endorse the views or opinions expressed in this press release.

The press release is provided for informational purposes only. The content does not provide tax, legal or investment advice or opinion regarding the suitability, value or profitability of any particular security, portfolio or investment strategy. Neither this website nor our affiliates shall be liable for any errors or inaccuracies in the content, or for any actions taken by you in reliance thereon. You expressly agree that your use of the information within this article is at your sole risk.

To the fullest extent permitted by applicable law, this website, its parent company, its subsidiaries, its affiliates and the respective shareholders, directors, officers, employees, agents, advertisers, content providers and licensors will not be liable (jointly or severally) to you for any direct, indirect, consequential, special, incidental, punitive or exemplary damages, including without limitation, lost profits, lost savings and lost revenues, whether in negligence, tort, contract or any other theory of liability, even if the parties have been advised of the possibility or could have foreseen any such damages.

More From Press Releases