“Q1’13 posted the strongest results for the first quarter of the year since 2008. However, the majority of the value is attributed to a large ticket telecommunications IPO in Iraq. This sector is traditionally associated with large value transactions and the high Q1 performance will be sustainable if we start to see similar large value transactions on a regular basis which would bolster the regions capital markets,” Phil Gandier, MENA Head of Transaction Advisory Services, Ernst & Young, said.
Two IPOs came to market in Saudi Arabia while one was reported in Iraq. The largest issuance was in Iraq, with Asiacell Communications raising $1.3 billion, followed by Northern Region Cement Company in Saudi Arabia that raised $240 million and National Medical Care Company in Saudi Arabia that raised $97.2 million.
“Over 40% of investors in the Middle East and Africa stated a preference to invest overseas, as evidenced in Ernst & Young’s recent institutional investor study. Therefore, the challenge remains whereby more domestic deal activity would be a key driver for stronger IPO activity and growth in the MENA region,” Phil, added.