Approximately $11.5bn as raised in the Arab region through 27 initial public offerings (IPOs) in 2014, said EFG Hermes head of research Wael Ziada.
This was compared to $3bn in 2013 through 25 IPOs, Ziada said during his speech in EFG Hermes’ One-on-One conference in Dubai on Monday.
“Tightening global liquidity, coupled with falling oil prices are likely to lead to a slower first half in 2015 in the GCC, following a very active 2014 for IPOs across the region; however the story is quite different for Egypt, which is going through a different cycle,” added Ziada.
According to Ziada, EFG Hermes helped lead the regional “IPO boom” last year, co-leading high-profile transactions. Amongst such transactions included Emaar Malls and Dubai Parks and Resorts in the UAE, and the Arabian Cement Company in Egypt, the first IPO in Egypt since 2010.
Ziada also noted that his firm is expecting to see mergers and acquisitions (M&A) activities led by Egypt. He added that the country has already seen two competitive M&A bids in the food sector in 2015.
On the challenges facing the Gulf region due to low oil prices, Ziada explained that in Dubai, the Expo 2020 will maintain public sector spending growth. As for Saudi Arabia, EFG-Hermes sees it as a “very compelling market” that will be of interest to path-finding investors who have long had an appetite for KSA equities.
“We expect the ongoing economic recovery in Egypt and recent remarks from the new head of the Capital Market Authority in Saudi Arabia, encouraging more state-owned companies to list, to have both Egypt and KSA lead activity in the MENA IPO market in the first half of this year,” said Mohamed Ebeid, Head of EFG Hermes Securities Brokerage, during his speech at the conference.