Citigroup Projects a Healthy Middle East IPO Pipeline Through 2024

Bankers in the Middle East are in for a busy summer, as Citigroup Inc. anticipates a flurry of initial public offerings (IPOs) in the fourth quarter, with a robust pipeline already taking shape for 2024. Rudy Saadi, the head of Middle East and North Africa equity capital markets at Citigroup, revealed in an interview on Monday that the Wall Street firm has received numerous requests for proposals for offerings, underscoring the region's status as a prime location for share sales.

“We expect to launch many IPOs in Dubai and Saudi Arabia post the summer,” he said, without giving several deals. “The pipeline is solid, it’s promising for post the summer and 2024.”

According to data compiled by Bloomberg, IPOs in the Middle East have already reached $5.1 billion this year, surpassing volumes recorded during the same period in nine out of the last ten years. The exceptional performance is second only to 2022, which saw $14.7 billion raised during the corresponding period. Entities such as the Dubai Roads & Transport Authority, encompassing taxi and parking businesses, are gearing up for public offerings. Banks have been invited to present pitches, and a listing of the taxi business could take place as early as this year, marking Dubai's first privatization in about 12 months. Additionally, Advanced Inhalation Rituals, the proprietor of the shisha brand Al Fakher, is actively working on an IPO in the region. People familiar with the matter also revealed that Abu Dhabi-based ed-tech firm Alef Education is exploring a public offering.

Rudy Saadi, along with Christian Cabanne, Bank of America's head of equity capital markets in Central and Eastern Europe, the Middle East, and Africa, foresee a trend where more privately owned companies in the region will seek to go public. The recent surge in IPO activity has predominantly been driven by the listing of state assets, and the expectation is that privately owned enterprises will increasingly join the IPO wave.

“I can tell you from the discussions we’re having with private families that this is the next wave of IPOs,” Saadi said. “We just need one or two IPOs coming privately in Dubai or Abu Dhabi to open that market and hopefully the rest will follow.”