Mena witnesses 48 IPOs raising $10.7b in 2023

The Middle East and North Africa (Mena) markets witnessed 48 initial public offerings (IPOs) in 2023, with total revenues amounting to $10.7 billion in total. Five listings, mainly in the energy and logistics sectors, contributed 58 percent towards the total IPO proceeds raised.

According to the Ernst & Young’s EY Mena IPO Eye Q4 2023 Report, 19 IPOs raised US$4.9 billion in proceeds during Q4 2023.

ADES Holding Company raised the most funds and contributed 25 percent of the overall IPO proceeds in the last quarter, followed by Pure Health Holding PJSC with 20 percent. All Q4 listing activity took place in the GCC region, with Egypt being the only non-GCC country that reported IPOs throughout 2023.

The 2024 pipeline includes 29 companies across various sectors announcing their intention to list, with the Kingdom of Saudi Arabia and the United Arab Emirates leading the way in terms of expected volumes. Outside the GCC, Egypt has four IPOs planned, the report added.

Brad Watson, EY Mena Strategy and Transactions Leader, said, “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 the KSA and the UAE leading the way in terms of expected volumes.”

Gregory Hughes, EY Mena IPO and Transaction Diligence Leader, commented, “The Mena IPO market delivered a healthy number of IPOs across various sectors in 2023. A number of reputable large state-owned companies listed in 2023, including the Dubai Taxi Co and OQ Gas Networks.”

The report stated that Abu Dhabi Securities Exchange (ADX) welcomed three IPOs in Q4 2023, raising a combined total of US$1.8 billion. These included Pure Health Holding PJSC, valued at US$987 million, Investcorp Capital plc at US$451 million and Phoenix Group PLC at US$371 million. Pure Health Holding PJSC reported the highest first-day gain of 76 percent. Additionally, there was one new listing in the transportation sector on the Dubai Financial Market (DFM) - Dubai Taxi Company PJSC, worth US$315 million.

Saudi Arabia lead the way 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 US$1.2 billion, followed by SAL Saudi Logistics Services Company at US$0.7 billion. Both IPOs were listed on the Tadawul Main Market. The remaining 12 IPOs, raising US$140 million 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.

The Muscat Stock Exchange (MSX) saw the largest IPO in Oman to date with OQ Gas Networks SAOC raising US$772 million. 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.

In Q4 2023, the UAE hosted the 28th United Nations Climate Change Conference (COP28), during which the DFM introduced a pilot platform to trade carbon credits that will allow companies to manage their residual and unavoidable carbon emissions, supporting their pursuit of decarbonisation and net-zero targets. In addition, ADX launched the FTSE Russell ESG Screened Index in time for COP28. The index provides investors with a transparent and tradable environmental, social and corporate governance (ESG) benchmark that ranks companies based on their ESG scores, promoting sustainable business practices among ADX-listed companies.

Emirates NBD Bank:  Emirates NBD Bank has become the first financial institution to benefit from a fee waiver launched by the Dubai Financial Services Authority (DFSA).

During COP28 in December 2023, DFSA Chief Executive Ian Johnston announced the decision to waive all regulatory fees for issuers wishing to list sustainability-related debt securities in the Dubai International Financial Centre (DIFC) throughout 2024.

The fee waiver was adopted to support the efforts of market participants who wish to list sustainability-related debt securities in the DIFC, and ultimately to accelerate the growth of sustainable capital markets in the Centre.

The latest issuance to Emirates NBD Bank demonstrates how the DFSA’s innovation is having an impact on the financial landscape, fostering a positive shift towards sustainable practices.

DFSA Chief Executive Ian Johnston expressed enthusiasm at the recent listings. He said, “The DFSA recognises the pivotal role that financial institutions play in promoting sustainability and addressing environmental and social challenges. By participating in the fee waiver, institutions are taking a proactive step towards adopting more sustainable financial practices.”

WAM