Saudi Arabia dominates slow MENA IPO market in Q1

The two listings on the Tadawul in Q1 raised $281.6 million. That compares with $1.45 billion from four listings for the whole of 2020, which represented a 78 percent share of the MENA IPO market, EY said in a report.

Alkhorayef Water & Power Technologies raised $144 million after its retail offering was oversubscribed by 1,511 percent and the institutional offering by 6,320 percent. Theeb Rent a Car Company collected $138 million from its IPO, which was oversubscribed by 6,010 percent for the institutional tranche and 3,385 percent for the retail offering.

MENA IPOs lagged the global market in Q1, which was the best first quarter in terms of both deal numbers and proceeds for the 20 years, generating $105.6 billion from 430 offerings, EY said. MENA IPOs raised $294.8 million, a 64 percent decline from the same period in 2020 and down from $925 million Q4, 2020.

“The MENA region’s IPO market was off to a slower than expected start in 2021, despite expectations for an increase in IPO activity after an uptick and stronger performance in Q4 of 2020,” said Matthew Benson, EY MENA strategy and transactions leader. “We expect IPO activity to bounce back over the coming months while economic conditions in the region continue to improve, aided by the accelerated vaccine rollouts and the possibility of reaching herd immunity against COVID-19.”