Egypt’s domestic IPOs tripled in 2015 while the country witnessed its first cross-border IPOs in five years, International law firm Baker & McKenzie stated in its latest report.
The firm noted that this allowed the country to escape the downwards trend of IPOs witnessed during the current year.
“Egypt tripled its domestic IPO activity with $360.3m raised from three listings in 2015, in contrast with one IPO valued at $108.7m in 2014,” the report read, referring to the IPOs of DBK Pharmaceuticals SAE, Edita Food Industries SAE, and Emaar Misr for Development SAE.
The report, entitled “Cross-Border IPO Index” highlighted that the country had the most notable IPOs across the Europe, Middle East, and Africa (EMEA) region.
Orascom Construction had a dual listing and IPO debut in the capital markets of the UAE and Egypt, collecting over $185m. Integrated Diagnostics Holding raised $334m through its IPO in the Egyptian and London Stock Exchanges, while Edita Food Industries SAE’s IPO in the same capital markets raised $264m.
Discussing the struggles in EMEA, the report said that “elections within Europe, the Scottish independence referendum as well as macro factors such as low Chinese and Eurozone growth and high third quarter market volatility have impacted the level of IPO activity”.
The law firm’s report added that emerging markets faced challenges “either from the ongoing standoff between Russia and Ukraine, or low oil prices affecting Nigeria and other oil-dependent African economies”.
“[The] next quarter was the theme of 2015 as IPOs kept being pushed back throughout the year,” head of banking and finance at Dubai’s Baker & McKenzie Habib Al Mulla merger Mazen Boustany said. Banks across the Middle East are bracing for more challenges in 2016, he further noted.
“With diversification accelerating across the GCC in an effort to reduce the impact of oil price volatility and with new commercial and financial regulations being implemented in the region, there is hope for future cross-border capital flows,” he said.
On Tuesday, the Egyptian exchange will hold a press conference in which it will discuss the progress made by the capital market in 2015.