Abu Dhabi bourse aims to top 2021's record listings this year, CEO says

Market value of Arab world's second-biggest exchange has risen about 25% since January to $549bn

The Abu Dhabi Securities Exchange plans to launch a tradeable version of the FTSE FADX 15 Index this year. Photo: ADX

The Abu Dhabi Securities Exchange expects to match or exceed the record number of listings it achieved in 2021 as it continues to add new products and expand its investor base, its managing director and chief executive said.

The bourse's benchmark FTSE ADX General Index was among the best-performing exchanges worldwide last year, having rallied more than 62 per cent in 2021. It is the best-performing bourse in the GCC this year, having climbed about 14 per cent since January.

Its market value was up about 25 per cent so far this year at more than Dh2.015 trillion ($549 billion) as of Monday 12.53pm UAE time, making it the Middle East and Arab world’s second-largest exchange.

“We are confident that the listing this year will not be less than what we have seen last year,” Saeed Al Dhaheri told The National.

“We are very optimistic. We are seeing the appetite from so many companies to come to Abu Dhabi and list … whether they are UAE companies or companies that are in the GCC, Europe, the US, Africa and Asia,” he said, when asked if the bourse could top its 2021 performance.

The ADX has a “good pipeline” of initial public offerings, with healthcare and FinTech companies among others expressing an interest in listing on the exchange this year, Mr Al Dhaheri said.

“We have a mix of pipeline GREs [government-related entities], we have family businesses … it is a mix of everything,” he said.

There were nine listings on the exchange last year, including the initial public offerings of Adnoc Drilling, which raised $1.1bn in October, and Fertiglobe, the world’s largest seaborne exporter of urea and ammonia combined, which reaped about $795 million.

The ADX has carried the IPO momentum into 2022. Abu Dhabi Ports Group, the operator of industrial cities and free zones in the emirate, began trading on the ADX in February.

Borouge, the joint venture between Adnoc and Austrian chemicals producer Borealis, successfully closed its $2bn IPO, the biggest share sale on the ADX, in a deal that was about 42 times oversubscribed.

The ADX could host 13 more listings before the end of this year as it seeks to reach a market value of Dh3tn, Mohammed Al Shorafa, chairman of the Abu Dhabi Economic Development Department, told Sky News Arabia in March.

The new listings will include four companies from outside the UAE, while others will be government and family companies, he said at the time.

Abu Dhabi is investing in five to 10 companies a year through its Dh5bn IPO fund to encourage the listing of private companies on the ADX, officials said last year.

“We have seen great listings contributing to the story of reaching [the] Dh2tn [mark] … adding new products has contributed to that [as well] and us changing some of regulations to provide good access to companies listed in Abu Dhabi,” Mr Al Dhaheri said.

“But for me, the goal is continuing. We are not stopping because we have [reached] a specific target or not.”

The value of stocks traded on the exchange in the first quarter of this year climbed 87 per cent a year to Dh202bn. The market value of shares owned by foreign investors in the first three months of the year jumped 163 per cent to Dh131bn, according to ADX data.

The value of stocks traded on the exchange in the first quarter of this year climbed 87 per cent year on year. Photo: ADX

Last week, the exchange concluded its investor roadshow in London, with senior executives from nine listed companies and the leadership of the ADX courting international investors to boost capital flows to the UAE.

The delegation, led by Mr Al Dhaheri, included the top management of Adnoc Distribution, Adnoc Drilling, Abu Dhabi Islamic Bank, Agthia, Aldar Properties, Al Yah Satellite Communications Company, Etisalat, First Abu Dhabi Bank and Fertiglobe.

The investor response was positive, Mr Al Dhaheri said.

“They like what the exchange has done in the past one year and a half in terms of … new listings, new products like Spacs [special purpose acquisition companies] and derivatives, and the rebranding of the second market,” he said.

The exchange listed its first Spac — the ADC Acquisition Corporation that seeks to acquire fast-growing technology companies — in May, and has received interest from other Spac sponsors that are interested in listing on the ADX.

A Spac is a vehicle with no commercial operations and is formed with the intention of raising funds through an IPO and then acquiring an existing company.

Spacs have lighter disclosure requirements than IPOs and have been increasingly used over the past two years to take fast-growing companies public quickly.

The ADX will add new products this year including more single-stock futures on its derivatives market, Mr Al Dhaheri said.

It may introduce between three to five futures this year and launch a tradeable version of the FTSE FADX 15 Index, most likely by the end of June.

“What is important to us also is to provide easy access to international institutional investors and retail investors to the ADX,” said Mr Al Dhaheri. “This is something that is very close to my heart.”

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Some of the biggest listings in UAE since 2021 - in pictures

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  Abu Dhabi Ports - $1.1 billion IPO in February 2022: AD Ports Group raised $1.1bn from its share sale to help expand its operations globally and boost growth. ADQ, one of the region’s largest holding companies, remains a majority shareholder in AD Ports Group with a 75.44 per cent stake in the listed entity. Reuters

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  Dewa became the first public entity to list on the Dubai Financial Market, raising Dh22.41bn in an oversubscribed share sale. The IPO of the Dubai utility in April was the largest in Europe and the Middle East since Saudi Aramco’s debut in 2019. It has a market value of about $39bn and is the largest on the exchange. AFP

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  Yahsat – $730.6 million in July 2021: a unit of Mubadala Investment Company, it raised about $731m from its initial public offering last July. It sold 975.9 million shares, or 40 per cent of equity, through the IPO, which was several times oversubscribed, with significant demand from both qualified institutional and retail investors in the UAE. Photo: Mubadala Investment Company

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  Adnoc Drilling - $1.1 billion IPO in October 2021: Adnoc Drilling’s share sale, oversubscribed more than 31 times, was the largest listing on the ADX, raising more than $1.1 billion. Adnoc maintains its majority 84 per cent stake in the company while US energy services company Baker Hughes, which entered into a strategic partnership with Adnoc Drilling in October 2018, has a 5 per cent stake, and US contract oil and gas driller Helmerich & Payne holds 1 per cent. Photo: Adnoc

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  Fertiglobe- $795 million in October 2021: a joint venture between Adnoc and Netherlands-listed OCI, raised about $795m in its initial IPO last year, amid strong demand from international, regional and local investors. The company — which is also the Mena region’s largest producer of nitrogen fertilisers by production capacity — sold more than 1.145 billion shares, representing 13.8 per cent of its share capital. Photo: Fertiglobe