The Middle East and Africa witnessed 48 initial public offerings (IPOs) throughout 2023, raising $10.7 billion, mainly driven by the Saudi Arabian market. The energy and logistics sectors were the most active, with five listings in these industries contributing 58% towards the total IPO proceeds raised.
The number, however, marked a 6% decrease and a 51% drop in proceeds, compared to 2022, according to data published in the EY MENA IPO Eye Q4 2023 report.
The Q4 results
The last quarter of 2023 saw 19 IPOs in the MENA region, which raised a combined $4.9 billion. All Q4 listing activity took place in the GCC region, with Egypt being the only non-GCC country that reported IPOs throughout 2023.
ADES Holding Company raised the most funds, and contributed 25% of the overall IPO proceeds in the period. The firm was followed by Pure Health Holding PJSC with 20%.
The quarter saw increased investor confidence in the region, 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%.
Saudi Arabia’s dominance
The Kingdom of Saudi Arabia has reaffirmed its dominance in terms of IPO activity in the region with 14 of the 19 listings in Q4 2023. The listings came from a variety of sectors, led by energy (36%), transportation (29%) and healthcare (10%).
ADES Holding Company marked the highest proceeds at US$1.2b, followed by SAL Saudi Logistics Services Company at US$0.7b. Both IPOs were listed on the Tadawul Main Market.
The remaining 12 IPOs, raising US$140m 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.
Q1 2024 kicked off with two Saudi listings: MBC Group, raising US$222m, and Avalon Pharma, raising US$437m.
The UAE, Oman and the 2024 outlook
The UAE and Abu Dhabi also recorded significant market activity during 2023.
Abu Dhabi Securities Exchange (ADX) welcomed three IPOs in the last quarter of the year, raising a combined total of US$1.8b. These included Pure Health Holding PJSC, valued at US$987m, Investcorp Capital plc at US$451m and Phoenix Group PLC at US$371m.
Meanwhile, the Muscat Stock Exchange (MSX) saw the largest IPO in Oman to date with OQ Gas Networks SAOC raising US$772m. 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.
Looking ahead, the outlook for 2024 looks promising, as the pipeline for the year 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.