UAE. Al Masah Capital Limited, one of the leading asset management firms in the MENA and SEA regions, has released its biannual report, which shows that MENA recorded private equity activity worth $2.6 billion and IPOs worth $914 million.
The staggering figures come on the back of a steady economic outlook for the MENA region, which is forecasted at 2.4% in 2015 for oil-exporting countries.
Surveying wealth creating vehicles and funds, IMF recorded a growing economic landscape in the Middle East and North Africa despite a slump in oil prices and increasing regional conflicts.
Oil-exporting countries shall remain steady at 2.4% in 2015, while growth in oil-importing countries will strengthen from 3.0% in 2014 to 4.0% in 2015, supported by the ongoing recovery in the Eurozone’s improved domestic confidence and more accommodating policies.
The international body also posed a growth forecast for GCC at 3.4%, while the non-GCC MENA countries are expected to register 2.0% growth in 2015. The recent economic developments entailing robust growth in non-oil sectors in the GCC, driven by diversification strategies employed by the region’s governments, will help partially offset the decline in oil prices.
Analyzing wealth vehicles in the region, Al Masah Capital reviewed Private Equity (PE) Activity in the MENA region. With 16 PE deals worth $2,677.3 million* during H1 2015 compared to twenty-six deals worth $128.7 million in 1H 2014, the deal value has been higher compared to the same period of the previous year.
Saudi Arabia and the UAE both witnessed the largest number of deals in 1H 2015, while Algeria led in terms of value.
Commenting on the ongoing developments in the world of private equity, Al Masah Capital founder and CEO Mr. Shailesh Dash said, “Our experience in market research suggests a pickup in PE activity during 2H 2015 with stabilization in oil prices, especially in consumption-led sectors such as healthcare, education, retail and F&B. The UAE, Saudi Arabia, Lebanon and Egypt are expected to be frontrunners in PE activity during the second half of 2015.”
Sectors like IT, retail and healthcare followed by telecom, financial services, industrial manufacturing, food & agriculture, oil & gas and media observed dynamic movements in private equity during H1 2015.
A total of four exit deals were reported during H1 2015, with Egypt, Jordan, Lebanon and the UAE witnessing one deal each. Of the four exit deals, two deals, worth $36.21 million, were in real estate.
In terms of Fund Raising Activities during the period, the MENA region undertook 16 IPOs worth $914.9 million. As for size, Egypt-based industrial manufacturing firm ASEC Company for Mining raised the largest amount with $150 million, followed by Saudi Company for Hardware ($134.4 million) and GB Auto S.A.E. in Egypt ($127.1 million).
Country-wise, Egypt recorded seven IPOs, the largest during the period, followed by four in Saudi Arabia.
In terms of value, Egypt and Saudi Arabia commanded IPOs worth $304.1 million and $279.7 million respectively. Financial services led in terms of volume and value, with six IPOs worth $294.5 million, followed by industrial machinery with four offerings worth $294.3 million.
The global economic activity continues to show strength. Al Masah Capital views this as substantial fuel to ignite economic growth within the MENA region, thereby providing a positive outlook for investments in major sectors such as IT, oil & gas, retail and real estate.
*Disclosed value of deals. Source – Zawya ThomsonOne Banker
About Al Masah Capital
Al Masah Capital is one of the fastest growing alternative asset management firms in the MENA and SEA regions. Established in 2010 and headquartered in Dubai, United Arab Emirates, Al Masah Capital provides tailor investment solutions to its clientele, from private equity (across Healthcare, Education, Food & Beverages, Logistics and other consumer driven sectors), asset management, corporate and real estate advisory as well as public market research services.
With subsidiaries in Abu Dhabi and Singapore, Al Masah secures opportunities for qualifying investors in 13 focus markets in MENA and South East Asia.