Moody's upgrades Saudi Arabia's credit rating to Aa3 with stable outlook    Riyadh Metro to begin partial operations next Wednesday: Report    Al Okhdood halts Al Shabab's winning streak with a 1-1 draw in Saudi Pro League    Mahrez leads Al Ahli to victory over Al Fayha in Saudi Pro League    Al Qadsiah hands Al Nassr their first defeat in the Saudi Pro League    Saudi musical marvels takes center stage in Tokyo's iconic opera hall    Downing Street indicates Netanyahu faces arrest if he enters UK    London's Gatwick airport reopens terminal after bomb scare evacuation    Civil Defense warns of thunderstorms across Saudi Arabia until Tuesday    Saudi Arabia, Japan strengthen cultural collaboration with new MoU    Slovak president meets Saudi delegation to bolster trade and investment ties    Saudi defense minister meets with Swedish state secretary    Navigating healthcare's future: Solutions for a sustainable system    Al Khaleej qualifies for Asian Men's Club League Handball Championship final    Sixth foreign tourist dies of suspected methanol poisoning in Laos    Katy Perry v Katie Perry: Singer wins right to use name in Australia    Trump picks Pam Bondi as attorney general after Matt Gaetz withdraws    Al-Jasser: Saudi Arabia to expand rail network to over 8,000 km    Sitting too much linked to heart disease –– even if you work out    Denmark's Victoria Kjær Theilvig wins Miss Universe 2024    Order vs. Morality: Lessons from New York's 1977 Blackout    India puts blockbuster Pakistani film on hold    The Vikings and the Islamic world    Filipino pilgrim's incredible evolution from an enemy of Islam to its staunch advocate    Exotic Taif Roses Simulation Performed at Taif Rose Festival    Asian shares mixed Tuesday    Weather Forecast for Tuesday    Saudi Tourism Authority Participates in Arabian Travel Market Exhibition in Dubai    Minister of Industry Announces 50 Investment Opportunities Worth over SAR 96 Billion in Machinery, Equipment Sector    HRH Crown Prince Offers Condolences to Crown Prince of Kuwait on Death of Sheikh Fawaz Salman Abdullah Al-Ali Al-Malek Al-Sabah    HRH Crown Prince Congratulates Santiago Peña on Winning Presidential Election in Paraguay    SDAIA Launches 1st Phase of 'Elevate Program' to Train 1,000 Women on Data, AI    41 Saudi Citizens and 171 Others from Brotherly and Friendly Countries Arrive in Saudi Arabia from Sudan    Saudi Arabia Hosts 1st Meeting of Arab Authorities Controlling Medicines    General Directorate of Narcotics Control Foils Attempt to Smuggle over 5 Million Amphetamine Pills    NAVI Javelins Crowned as Champions of Women's Counter-Strike: Global Offensive (CS:GO) Competitions    Saudi Karate Team Wins Four Medals in World Youth League Championship    Third Edition of FIFA Forward Program Kicks off in Riyadh    Evacuated from Sudan, 187 Nationals from Several Countries Arrive in Jeddah    SPA Documents Thajjud Prayer at Prophet's Mosque in Madinah    SFDA Recommends to Test Blood Sugar at Home Two or Three Hours after Meals    SFDA Offers Various Recommendations for Safe Food Frying    SFDA Provides Five Tips for Using Home Blood Pressure Monitor    SFDA: Instant Soup Contains Large Amounts of Salt    Mawani: New shipping service to connect Jubail Commercial Port to 11 global ports    Custodian of the Two Holy Mosques Delivers Speech to Pilgrims, Citizens, Residents and Muslims around the World    Sheikh Al-Issa in Arafah's Sermon: Allaah Blessed You by Making It Easy for You to Carry out This Obligation. Thus, Ensure Following the Guidance of Your Prophet    Custodian of the Two Holy Mosques addresses citizens and all Muslims on the occasion of the Holy month of Ramadan    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



KSA raised $460.5m through IPOs in 2011
Published in The Saudi Gazette on 04 - 01 - 2012

The regional capital markets earned US$843.9m in 2011 as compared to US$2.8b in 2010, witnessing a decline of 69.3%, according to the Ernst & Young's year-end MENA IPO report. The year is closing with IPO funds worth US$226.1m being raised in the fourth quarter, a decline of 83.5% from US$1.4 Bn raised in Q4'10.
Commenting on the overall performance of the capital markets in 2011, Phil Gandier, MENA Head of Transaction Advisory Services, Ernst & Young, says: “Companies chose other fundraising routes over IPOs in 2011, which was another year of low capital market activity. Low investor interest continued in the MENA region as companies chose Islamic funding such as Sukuk, which saw a record year, as the preferred route for fundraising.”
He said the investors and issuers in the region remain concerned over the volatility of the capital markets. “This will likely continue in the next quarter.”
“The number of announced IPOs continues to grow across the region,” he added. “We witness a flood of IPOs in the regional bourses the moment economic conditions and investor sentiment improves.”
United Electronic Company in Saudi Arabia was the largest IPO in Q4'11 with US$105.6 Mn, followed by SMN Power Holding in Oman with US$63.9 Mn, Saudi Enaya Cooperative Insurance Company in Saudi Arabia with US$42.7 Mn and Jet ALU MAROC in Morocco with US$13.9 Mn.
The largest IPO of 2011 in MENA was UAE's Eshraq Properties Company (US$229.1 Mn) followed by Saudi Arabia's Hail Cement Company (US$130.5 Mn) and the United Electronic Company (US$105.6 Mn).
Saudi Arabia led the country standings in 2011, raising US$460.5 Mn through IPOs in all of 2011, followed by the UAE with US$271.3 Mn and Oman with US$63.9 Mn. Morocco, Tunisia, Jordan and Syria were the only other MENA countries with IPO activity in 2011.
In all of 2011, five IPOs each were seen in both the Industrial Manufacturing and Financial sectors, two in the Telecommunications sector and one IPO in each of the Power and Utilities, Real Estate and Retail sectors.
Global IPO fundraising down 45% in 2011, 72% of global capital was raised in H1. After a promising start in the first two quarters, IPO activity dropped dramatically midway through the year, principally due to investors concerns about sovereign debt issues in Europe and Standard & Poor's downgrade of US credit rating. Year-to-date, the capital raised globally is down by 45%, with US$155.8b, and number of deals is also down by 20% (1117 IPOs), compared to full year 2010. Seventy-two percent of global capital was raised in the first 6 months of the year. However, 2011 fundraising activity still exceeded 2009 by more than US$40 Bn, according to Ernst & Young's year-end Global IPO update.
“The uncertainty around a resolution to the Eurozone debt crisis and its impact on the global economy has left investors and issuers with a lack of confidence,” says Maria Pinelli, Global Vice Chair, Strategic Growth Markets, Ernst & Young.
Asian exchanges completed 543 deals in the first 11 months of the year raising US$77.7b, a 56% drop in capital raised compared to full year 2010 (US$177.6b). The largest IPO on Asian exchanges this year was the US$5.5b listing of Hutchison Port Holdings on the Hong Kong Stock Exchange (HKEx), followed by Italian fashion house Prada SpA, for US$2.5b on HKEx.
IPO activity on US exchanges held up relatively well with a modest 16% drop in capital raised, from US$43.5b via 163 deals in 2010 to US$36.4b in 114 IPOs. IPOs on European exchanges accounted for 19% of capital raised and US$29.6b in value via 251 IPOs. This compares with 13% of total capital raised last year, with 252 IPOs raising US$36.7b. Deal value and activity has also fallen for Central and South American issuers (US$8.6b and 27 IPOs) with no IPOs recorded in Q4'11.
2011 saw the largest PE-backed IPO ever with the US$4.3b IPO of the America's largest hospital chain operator, HCA Holdings Inc in March on the New York Stock Exchange (NYSE). Globally, PE-backed IPOs companies exited 168 companies, raising around US$37b. Seventy companies raised US$31.4b in the first six months of 2011, putting the industry on pace for its best year on record. Despite the challenging environment, pricing generally improved for PE-backed deals compared to 2010, resulting primarily from a number of large deals that took advantage of the wide-open window in the first quarter of the year. Overall, PE-backed deals have accounted for 24% of the global proceeds raised in 2011, the highest percentage on record.
Jeff Bunder, Global Private Equity Leader at Ernst & Young says: “Moving into 2012, the outlook remains heavily dependent upon stabilization in Europe, accelerated growth in the US and improved investor confidence in Asia. With PE portfolio aging rapidly, sponsors are looking closely for any indication that the IPO window is reopening.” Currently, there are more than 95 companies registered to go public, which in aggregate could raise more than US$20b. “In a new normal, where volatility in public equities markets and in the global economy are constant and expected, PE firms have become more nimble and are prepared for when the IPO window opens next,” said Bunder.


Clic here to read the story from its source.