Page 193 - AAE PR REPORT - June 2024

5/30/24, 8:43 AM MENA’s IPO pipeline to remain ‘promising’ in 2024, despite regional challenges
The privatisation of state-backed entities is leading to greater economic diversification,
private sector development and sovereign liquidity creation, the report adds. As of March

2024, Dubai had followed through on six out of the 10 government entities it plans to take

public, including Parkin, which was 165 times covered and attracted $71 billion in orders.

From the private sector, the listing of family-owned companies have also helped drive

business growth, succession planning and enhanced governance and transparency, the

report states. Al Ansari Financial Services, one of the UAE’s largest remittance and foreign
currency exchange companies, owned by a local family group, raised $210 million from its

2023 IPO, while Spinneys, listed on DFM in April of this year.

The report adds that highly anticipated listings such as Lulu’s forthcoming IPO

demonstrates an ever-growing list of incentives for other family businesses to follow suit.

A third wave of IPOs is expected through finTech and tech-enabled start-up exits, helping
to stimulate new industries with high-growth potential, while creating strong demand from

investors and viable exit options for VC investors.

“Driven by the rise in IPOs, capital markets across the MENA region have seen significant
growth, with reforms dedicated to improving market infrastructure, attracting even greater

foreign investment flows,” said Arif Amiri, Chief Executive Officer, DIFC Authority.

Outlook for 2024

According to Nadim Najjar, Managing Director, CEEMA, London Stock Exchange Group,

the past two years have been a period of significant change for global capital markets with

multiple Federal Reserve rate hikes, which began in 2022, leading to interest rates
touching highs last seen in 2001.

“The shift in monetary policy has taken a toll on global capital markets, leading to lower
company valuations which in turn caused many companies to postpone their IPOs until

market conditions improved. The resulting increase in financing costs also discouraged

issuers from tapping debt markets,” he said.

The regional expert said that despite these challenges, the MENA IPO market witnessed a

surge in activity in 2022, driven by privatisation programmes in the UAE and Saudi Arabia.

https://www.zawya.com/en/markets/equities/menas-ipo-pipeline-to-remain-promising-in-2024-despite-regional-challenges-j5lixn6n 3/5