MENA markets witness 48 IPOS raising $10.7bn in 2023

The Middle East and North Africa (MENA) markets saw 48 initial public offerings (IPOS) in 2023, raising $10.7bn in total, according to the EY MENA IPO Eye Q4 2023 report.

Five listings, mainly in the energy and logistics sectors, contributed 58% towards the total IPO proceeds raised, the report said.

The Muscat Stock Exchange (MSX) saw the largest IPO in Oman to date with OQ Gas Networks raising $772mn. Meanwhile, Oman Investment Authority (OIA), the country’s sovereign wealth fund, is preparing to launch multiple IPOS and list state assets to strengthen its capital markets, according to the EY report.

During Q4 2023, 19 IPOS raised $4.9bn in proceeds. ADES Holding Company raised the most funds and contributed 25% of the overall IPO proceeds in the last quarter, followed by Pure Health Holding with 20%. All Q4 listing activity took place in the GCC region, with Egypt being the only non-gcc country that reported IPOS throughout 2023.

Investor confidence in the region continues, with 11 out of the 19 Q4 2023 IPOS recording a first-day gain in share price. At the end of 2023, 26 out of the 48 IPOS showed a positive return compared to their listing price, with Armah Sports Company achieving the highest gain at 72%.

Last year recorded a 6% decrease in the number of IPOS and a 51% drop in proceeds, compared to 2022. Notably, 2022 witnessed a significant number of IPOS, such as Americana Restaurants International (Americana), Saudi Aramco Base Oil Company (Luberef) and Arabian Drilling Company, which played a role in the decline seen in 2023.

The 2024 pipeline includes 29 companies across various sectors announcing their intention to list, with Saudi Arabia and the UAE leading the way in terms of expected volumes. Outside the GCC, Egypt has four IPOS planned.

In a press release, Brad Watson, EY MENA Strategy and Transactions Leader, said, “In 2023, there were a total of 48 IPOS raising $10.7bn, of which five listed companies contributed 58% toward the total IPO proceeds raised, mainly in the energy and logistics sectors. Investor confidence in the region continues with 11 out of the 19 Q4 2023 IPOS recording a first day gain in share price.”

“The 2024 pipeline includes 29 companies across various sectors, announcing their intention to list with Saudi Arabia and the UAE leading the way in terms of expected volumes.”

Once again, Saudi Arabia reaffirmed its dominance in terms of IPO activity in the region with 14 of the 19 listings in Q4 2023. ADES Holding Company marked the highest proceeds at $1.2bn, followed by SAL Saudi Logistics Services Company at $0.7bn. Both IPOS were listed on the Tadawul Main Market. The remaining 12 IPOS, raising $140mn in total, took place on the Nomu – Parallel Market, which also witnessed the quarter’s only direct listing in the MENA region – Almujtama Alraida Medical Co.

Gregory Hughes, EY MENA IPO and Transaction Diligence Leader, said, “The MENA IPO market delivered a healthy number of IPOS across various sectors in 2023, despite the subdued global economic backdrop and the rising geopolitical tensions in the Middle East. A number of reputable large stateowned companies listed in 2023, including the Dubai Taxi Co and OQ Gas Networks.”