(MENAFN- The Peninsula) The Peninsula
The Middle East IPO volumes in 2017 picked up with 300 percent increase in value of domestic deals and securing the first cross-border listing in the region since 2015.
Global volume reached the highest level in a decade, according to the latest Cross-Border IPO Index by global law firm Baker McKenzie.
Low market volatility as a result of the relatively benign geopolitical environment and improved market sentiment were behind the increase in global IPO activity, which saw both cross-border and domestic activity grow.
In total, 1,694 companies raised $206.6bn from IPOs, a jump of around a third in both value and volume on 2016.
Cross-border deals jumped by 60 percent in volume, growing in all regions, including Latin America, which saw its first cross-border listing in 10 years. Cross-border capital raising also grew in value in 2017 by 25 percent, the majority of which was accounted for by a strong performance in Europe, Middle East and Africa (EMEA) and North America. That helped offset a decline in Asia Pacific cross-border capital raising.
'The economic activity associated with IPOs is vital for the overall development of regional capital markets, which in turn will stimulate further growth in Arab economies, said Mazen Boustany (pictured), Head of Banking & Finance at Baker McKenzie Habib Al Mulla.
On the Middle East domestic front, IPO values were up an impressive 55 percent year on year, from $676m to $2.1bn in 2017, while volumes also increased by 40 percent, from four IPOs in 2016 to 12 IPOs in 2017. The number of IPOs this year compared to 2015 climbed by 22 percent, although capital raised fell by 3 percent.
Overall IPO activity from the Middle East (both domestic and cross-border) saw a 225 percent increase in terms of volume and 315 percent increase in value. The UAE, Saudi Arabia, Qatar and Oman led domestic IPO activity in the region.
'Stability of oil prices and the political situation will contribute to developing market penetration and enhancing liquidity, added Zahi Younes, Capital Markets/M & A partner at Baker McKenzie.
The top sectors by volume for domestic IPOs in the region in 2017 were Financials and Energy & Power, with three listings each, and the top sector by value was the Real Estate sector, with more than $1.2bn raised from one listing. It proved a steady year for capital raising in Asia Pacific's exchanges during 2017, with issuance totalling $92.4bn accounting for a 13 percnet increase compared to 2016.
The Cross-Border IPO Index in Asia Pacific fell by 20 percent in 2017, as domestic deals dominated the share of new equity deals in the region and the cross-border capital raised during the year fell 24 percent.
After a slow start, it has been a buoyant year for IPOs in EMEA in 2017 with both the volume of capital raised and the number of issuances climbing sharply. Total capital raised climbed by 55 percent to $55.1bn while the number of issues was up 25 percent to 227, both following two previous years of decline.
The Cross-Border IPO Index in EMEA was one of the most promising increases in 2017, after continuous years of decline. The EMEA index increased by 93 percent in 2017, as cross-border capital raising and the number of IPOs experienced increases, driven by the largest cross-border lPO this year.
MENAFN3012201700630000ID1096290925
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.