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Thursday, 24 March 2022

IPOs: Gulf > Europe

Gulf > Europe in the IPO market: Surging oil prices are fueling an IPO boom in the MENA region, helping it to surpass the European IPO market for only the second time since the global financial crisis, Bloomberg reports. Companies listing in the region have raised a combined USD 4.8 bn in proceeds so far this year, comfortably higher than the USD 3.9 bn in Europe. “The recent movements in oil prices have translated into regional investors having additional capital to deploy, which is also contributing to propping up the market,” said Andree Chakhtoura, head of investment banking at Bank of America’s MENA unit.

Twice in 13 years: The only other time that MENA IPOs have exceeded those in Europe since 2009 was in 2019 when Saudi Aramco completed the world’s biggest-ever IPO.

An IPO best served crunchy: Americana Group, which operates KFC and Pizza Hut in MENA, is in early discussions with advisors for a potential IPO in Saudi Arabia or UAE, Bloomberg reports, citing sources with knowledge of the matter. Americana Group, owned partly by Saudi Arabia’s Public Investment Fund (PIF) and an investment vehicle led by UAE businessman Mohamed Alabbar, has held talks with advisors, but has yet to make appointments and the future of a listing is not certain, the sources said. A rare dual listing is also possible, they said, with one of the sources estimating the IPO could raise USD 1 bn. If the IPO goes forward, it would come as the Gulf continues to see an IPO boom, with equities in the Gulf continuing to outperform other emerging markets, which have seen outflows of USD 14.3 bn since the beginning of the year.

Speaking of Gulf equities: The Middle East could see some USD 82 bn of inflows this year, as emerging market funds are bullish on the region, according to a Morgan Stanley note picked up by Bloomberg. The forecast cites “fundamental, structural, and technical reasons” that will likely see equities in the region “continue to outperform,” with the investment bank going overweight on Qatar, Saudi Arabia, the UAE, and Kuwait in particular.

MEANWHILE- Shuaa Capital launched a USD 250 mn sharia fund, Shuaa Venture Partners, marking the GCC's largest venture debt fund, it announced in a statement.

Up

EGX30

11,744

+0.7% (YTD: -1.7%)

Up

USD (CBE)

Buy 18.32

Sell 18.42

Up

USD at CIB

Buy 18.32

Sell 18.42

None

Interest rates CBE

9.25% deposit

10.25% lending

Up

Tadawul

12,944

+0.5% (YTD: +14.7%)

Up

ADX

9,724

+1.0% (YTD: +14.6%)

Up

DFM

3,361

+0.4% (YTD: +5.2%)

Down

S&P 500

4,456

-1.2% (YTD: -6.5%)

Down

FTSE 100

7,461

-0.2% (YTD: +1.0%)

Up

Brent crude

USD 121.60

+5.3%

Down

Natural gas (Nymex)

USD 5.12

-2.2%

Up

Gold

USD 1,950.50

+0.4%

Down

BTC

USD 42,508

-0.2% (as of midnight)

THE CLOSING BELL-

The EGX30 rose 0.7% at yesterday’s close on turnover of EGP 1.04 bn (7.4% above the 90-day average). Foreign investors were net sellers. The index is down 1.7% YTD.

In the green: Heliopolis Housing (+7.2%), Ezz Steel (+5.8%) and Madinet Nasr Housing (+2.9%).

In the red: Ibnsina Pharma (-2.0%), TMG Holding (-1.8%) and MM Group (-1.5%).

Most Asian markets are down in early trading this morning. It’s also a sea of red in European stock futures, while shares in the US are currently poised to rise at the opening bell.

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