In Q1 2024, the IPO activity in the MENA region retained strong momentum, with 10 IPOs in Saudi Arabia and the UAE, raising a combined $1.2 billion.
According to the EY MENA IPO Eye Q1 2024 report, 25 private companies and 10 funds across various sectors intend to list on MENA exchanges in 2024. KSA leads with 21 announced IPOs, followed by the UAE with one. Outside of the GCC, Raya Information Technology in Egypt and Crédit Populaire d’Algérie in Algeria have announced their planned IPOs.
Tadawul was reported to remain the most active exchange in the GCC, with all but one IPO taking place on either the main Tadawul market or the Nomu parallel market. According to the latest PwC Middle East’s IPO Watch, three IPOs raised $667 million on the main market, whereas six IPOs raised $57 million on the parallel market.
As the market gains the IPO momentum, here are the top five GCC IPOs in Q1 2024 as listed by PwC Middle East:
Parkin Company
Exchange: DFM
Money raised: $429 million
Dubai-based paid parking facilities and services provider Parkin witnessed unprecedented interest in its IPO. The total gross demand for the IPO reached an impressive Dh259 billion ($71 billion) at the final offer price, marking a remarkable oversubscription level of 165 times for all tranches combined, setting a new record on the Dubai Financial Market (DFM).
Modern Mills for Food Products Co.
Exchange: Tadawul
Money raised: $314 million
Modern Mills is the second of four flour milling companies to go public after the government-controlled industry was split and sold to the private sector. First Milling Co. went public in May 2023 with a $266 million IPO. Investors put in about $40 billion of orders for Saudi Arabia’s Modern Mills for Food Products Co.’s initial public offering, as demand for share sales in the Middle East shows no signs of abating.
According to a statement, the demand for the institutional tranche of the SAR 1.2 billion ($320 million) IPO amounted to coverage of almost 127 times. The price was set at SAR 48 per share, the top end of a marketed range, implying a market capitalisation of SAR 3.9 billion.
MBC Group Co.
Exchange: Tadawul
Money raised: $222 million
The company reported robust demand for MBC’s offering from diverse local, regional and international investors. The institutional book-building process generated an order book of SAR 54.5 billion, resulting in a subscription coverage of approximately 66x. The final offering price was fixed at SAR 25 per share, aligning with the upper range of the earlier announced IPO price range.
The successful IPO raised SAR 831 million ($222 million), establishing an implied market capitalisation of SAR 8.3 billion ($2.2 billion) at the time of listing.
Middle East Pharmaceutical Industries Co. (Avalon Pharma)
Exchange: Tadawul
Money raised: $131 million
Riyadh-based Avalon Pharma raised SAR 492 million ($131 million) in its initial public offering after pricing its shares at the top of the range. The company set the final offer price at SAR 82 per share for its listing of a 30% stake. The pricing values the company at SAR 1.65 billion. Total gross demand for the offering amounted to SAR 2.67 billion, implying an oversubscription level of about 5.4 times.
Avalon, which began operations in 1998, is involved in the manufacturing and marketing a wide range of consumer health and beauty brands and generic prescription medicines. The company exports products to more than 10 countries across the Middle East and North Africa and is one of the fastest-growing consumer pharma companies in Saudi Arabia.
Al-Modawat Specialized Medical Co.
Exchange: Tadawul – Nomu
Money raised: $14 million
The Capital Market Authority approved the Saudi Arabian healthcare firm Al-Modawat Specialised Medical Co’s application to float 475,000 shares in the parallel market in September 2023, representing 20% of its share capital. It concluded its initial public offering (IPO) on February 5, reporting a coverage of 135.75% of the total shares. The offer price was set at SAR 111 ($29.5) per share.
Nomu is the Saudi Exchange’s parallel equity market, which acts as an alternative platform for companies seeking to expand and go public. It aims to allow small and medium-sized companies to diversify their funding sources and develop their businesses and activities by offering lighter listing requirements in terms of market capitalisation, minimum number of shareholders, and offering percentage.
