Saudi Arabia and the UAE: Pushing past others notwithstanding the global crises

Key takeaways

  • Saudi Arabia and the UAE have raised USD11.5bn through initial public offerings (IPOs) in the first six months of 2022 (1H22), while Europe has managed USD4.9bn.
  • Companies in the Middle East and North Africa (MENA) are removing foreign ownership limitations to attract international interest in the region.
  • Abu Dhabi Exchange (ADX) has launched Growth Market to encourage small businesses to opt for direct listing instead of IPO for participation in capital markets.

Catalysts that may drive Middle Eastearn markets to perform better in the long term are:

1.Increasing IPOs

The Middle Eastern markets have overtaken their European counterparts when it comes to IPO proceeds in 2022. European IPO activity in 1H22 saw the issuance of USD4.9bn, whereas ADX, DFM and TASI cumulatively raised USD11.5bn during the period. The last time the Middle East beat Europe after 2009 was in late 2019, when Saudi Aramco’s IPO recorded the world’s largest offering.

  • National Marine Dredging Company, which was averse to foreign ownership earlier, permits foreign buyers to own up to 49% equity.
  • Arabian Scandinavian Insurance has received all the necessary approvals to allow foreigners to own 49% capital.

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Acuity Knowledge Partners

Acuity Knowledge Partners

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We write about financial industry trends, the impact of regulatory changes and opinions on industry inflection points. https://www.acuitykp.com/