Saudi tops IPO activity

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The second quarter of the year witnessed an improvement in Initial Public Offer (IPO) activity in the MENA region despite a dip in volume. IPO deal value increased by 222.6 percent to $2,822.5 million in Q2 2019, up from $874.9 million during the same time last year, professional services firm EY said in its latest report MENA IPO Eye. In terms of volume, only six deals were recorded in Q2 2019, including one REIT listing, a decrease of 33.3 percent from the nine deals listed in Q2 2018. However, on quarter-on-quarter basis, IPO activity increased both in volume and value, when compared to a single IPO that raised $57.6 million in Q1 2019. Gregory Hughes, MENA IPO Leader, EY, said: “The increase in IPO activity across the MENA region during the second quarter of this year, which included two cross-border listings, is proof that companies are still keen to execute IPOs and gain access to international investors and stock markets.” “The IPO deal value raised in the first half of 2019 has already nearly surpassed the total deal value raised in 2018,” he added. While the UAE witnessed two cross-border listings with proceeds of $1,797.9 million in Q2 2019, Saudi Arabia led the MENA region with three listings on the main market in Q2 2019 with net proceeds of $1,023.4 million. Arabian Centres Company, one of the largest IPOs in Saudi Arabia with proceeds of $658.7 million, was the first in the country that allowed the sale of securities to qualified institutional buyers in the US. Maharah Human Resources Company and Shuaa REIT Fund raised IPO net proceeds of $207 million and $157.7 million respectively. UAE-based fintech companies Network International Holdings raised $1.4 billion in April and Finablr raised $397.9 million in May. Both firms listed on the on the Premium Segment of the London Stock Exchange. “Across the MENA region, IPO activity is expected to progress cautiously, with an optimistic outlook owing to events and themes such as the MSCI and FTSE inclusions, privatization drives, and government initiatives,” said Hughes. Global IPO exchange activity continued to pick up in Q2 2019, with 302 IPOs raising $56.8 billion.—Agencies

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