Saudi Arabia has continued to take the lead in the initial public offering (IPO) sector in the Middle East and North Africa (MENA) region, which has recently raised nearly $1 billion in proceeds in just three months and currently boosts a strong pipeline of listings.

During the third quarter of the year, five IPOs were launched in Saudi Arabia, UAE and Egypt, with a hefty combined turnout of $0.93 billion, marking a significant year-on-year growth.

"In Q3 2024, companies raised proceeds of $0.93 billion, which was 76.8% higher than prior year," said Brad Watson, EY MENA Strategy and Transactional Leader.

The kingdom, which continues to roll out initiatives to attract investors and lessen its reliance on oil revenues, led the share sales, accounting for three out of five IPOs and raising $27 million in proceeds.

The Gulf state’s parallel equity market Nomu, in particular, emerged as the leader in fundraising activity, having registered the most IPOs this year.

“Saudi Arabia continues to lead IPO activity in the region,” said Gregory Hughes, EY MENA IPO Leader.

“The Tadawul Nomu- Parallel Market has become an attractive option, offering improved fundraising opportunities for the kingdom’s growing SME sector. For the MENA region, it is now the stock exchange with the highest number of IPOs in 2024,” Hughes said.

The biggest IPO proceeds in Saudi Arabia during the third quarter, amounting to $12 million or nearly half of the total, went to Tharwah Human Resources Company, which became the first consulting firm to be publicly traded in Saudi’s parallel market.

ASG Plastic Factory Company came second with $9 million in proceeds, followed by Al Ashghal Almoysra Company with $6 million, which both floated their shares on Nomu.

There were two other new joiners in the parallel market, with Saudi firms Naas Petrol Factory Company and the Arabian United Float Glass Company listing directly on Nomu.

Elsewhere in the region, the UAE ended the recent quarter with the largest IPO, with NMDC Energy snapping up $877 million in proceeds prior to debuting on the Abu Dhabi Securities Exchange (ADX).

In Egypt, Act Financial’s IPO and listing on the Egyptian Exchange was the first since 2022.

More offerings are expected, with 11 businesses and five funds already confirming listing plans before year-end.

(Writing by Cleofe Maceda; editing by Seban Scaria seban.scaria@lseg.com)