Muscat – The Middle East and North Africa (MENA) region saw only four initial public offerings (IPOs) in the first half of 2021.
These four IPOs raised US$425.8mn proceeds, a drop of 48 per cent compared with the same period of 2020, according to a report released by EY.
The number of listings stayed the same year-on-year.
The year 2021 began with a slow start after an uptick of issuances in the fourth quarter of 2020. Following the three IPOs listed in the first quarter of 2021, the second quarter of 2021 saw only one IPO issued by Taaleem Management Services, which was listed in Egypt and raised US$131mn in proceeds.
Matthew Benson, EY MENA strategy and transactions leader, said, “The MENA region’s IPO market did not witness a pick-up in activity during the second quarter, with only one IPO occurring on the Egypt stock exchange, while direct listings continued their momentum with six listings across several MENA countries.”
He said that preparations are ongoing for several key transactions expected to occur during the second half of this year, in particular with the UAE and Saudi Arabia demonstrating a strong pipeline of IPO candidates.
“Our outlook on the region’s IPO activity remains positive, taking into account the continued improvement in economic conditions and stability in the region, coupled with the strong performance of oil prices we have seen thus far in 2021,” Benson added.
Although there were no IPOs in Saudi Arabia during the second quarter of 2021, the Saudi Capital Market Authority has issued approvals for several IPOs on Tadawul.
Gregory Hughes, EY MENA IPO and transaction diligence leader, said, “IPO activity during the first half of 2021 was below expectations, nevertheless the year did bring some remarkable deals with MENA companies showing an ever-increasing interest in SPAC transactions as a means to go public.”