UAE leads GCC markets with IPO proceeds of $3.2 billion in first quarter

Abu Dhabi bourse recorded the highest proceeds with $3 billion through the offerings of Adnoc Gas and Presight AI

Adnoc Gas IPO proceeds constituted 71 per cent of total GCC IPO proceeds in the first quarter. Photo: ADX

Issuers in the UAE led the Gulf markets with proceeds of $3.2 billion from three initial public offerings in the first quarter of 2023, more than doubling in value year-on-year, reflecting the momentum of the country's booming capital market.

However, the six-member GCC bloc raised a combined total of $3.5 billion in proceeds through 12 IPOs during the first three months of 2023, a 25 per cent decline from $4.6 billion raised in 13 IPO deals during the same a year earlier, the Kuwait Financial Centre (Markaz) said in a report on Sunday.

The Abu Dhabi Securities Exchange recorded the highest proceeds with $3 billion from Adnoc's sale of a 5 per cent stake in its gas business and data analytics company Presight AI's listing of 24.24 per cent of its stock, the report showed.

Listings on the Dubai Financial Market raised a total of $210 million from the sale of a 10 per cent stake in Al Ansari Financial Services, the UAE foreign exchange and money transfer company.

"The UAE offerings constituted 91 per cent of total GCC IPO proceeds in the first quarter of 2023," the report said.

The UAE and the wider GCC region have seen a flurry of IPOs amid strong investor demand as economies rebound at a quicker pace from the pandemic-induced slowdown and liquidity has been shored up by high oil prices.

The IPO drive in the Middle East has continued to gather pace in 2023 after the region registered 48 listings last year that raised more than $23 billion, compared with $7.52 billion from 20 offerings in 2021.

That was the highest for the Gulf region after 2019, when Saudi Aramco went public in a $29 billion offering, the world’s largest.

The GCC's top five IPOs by the value during the first quarter were Adnoc Gas, Presight AI, Oman's Abraj Energy Services, Al Ansari Financial Services and Ghida Al-Sultan for Fast Food Company, according to Markaz.

Adnoc raised about $2.5 billion from the sale of a 5 per cent stake in its gas business, marking the year's largest listing globally. The Adnoc Gas listing was about 50 times oversubscribed and drew more than $124 billion in orders.

Adnoc Gas IPO proceeds constituted 71 per cent of total GCC IPO proceeds in the first quarter, Markaz said.

Presight AI, which made its debut on the ADX in March, sold more than 1.35 billion shares at Dh1.34 a share, equal to 24.24 per cent of the company’s stock upon listing, attracting Dh94.9 billion ($25.8 billion) in bids for its IPO.

Presight IPO constituted 14 per cent of total GCC IPO proceeds during the period, Markaz said.

Muscat Securities Market recorded one IPO during the first three months of the year, with total proceeds of $244 million.

The Saudi Exchange (Tadawul) registered 8 IPOs during the period, which generated total proceeds of $72 million, about 2 per cent of total GCC IPOs' value.

Prospects of the IPO market remains bright for the remainder of the year. The Tadawul received 100 listing applications until mid-February and 23 companies obtained final approval for their IPO, according to Markaz data

Saudi Arabia’s First Mills Company is planning to float 16.65 million shares, or 30 per cent of its share capital, in a deal that could value the company at as much as $1 billion, the report said.

Al Mawarid Manpower Company intends to offer 4.5 million shares, or 30 per cent of its capital, on Tadawul in May.

The UAE is also expecting 11 IPOs this year, with Adnoc planning to float its marine and logistics subsidiary in the coming months, Markaz said.

Oman’s OQ Gas Network is preparing for a public share sale that could take place as early as June and may raise more than $500 million, according to the report.