Middle East markets resisted the dramatic global downturn in the IPO market by raising $3.61 billion in the third quarter of 2008 from 12 initial public offerings (IPOs), Ernst & Young said in its latest quarterly Global IPO report. Five IPOs from the Middle East entered the list of top 20 global IPOs by funds raised in the third quarter. The Saudi Arabian Mining Company IPO was the largest in the world by capital raised with $2.467 billion. Azhar Zafar, head of Mergers and Acquisitions, Ernst & Young Middle East, said: “Saudi Arabia was placed second globally in terms of funds raised by any country with $3 billion, equalling 23 per cent of the global IPO market.” Although capital raised was down 23 percent in the region than in the previous quarter ($4.72 billion from 13 IPOs), regional markets fared much better compared to global markets. Funds raised globally were down 66 per cent and there have been 108 fewer deals, the lowest activity level seen since 2003, following the dotcom collapse, the report said. From the total IPOs, Saudi Arabia hosted three of the IPOs while the UAE hosted two IPOs. However, the leader in the number of IPOs in the region was Jordan with six. Phil Gandier, managing partner, Transaction Advisory Services, Ernst & Young Middle East, added: “It is interesting to note that the deal threshold to make the global top 20 has fallen significantly since 2007 when the minimum deal value required to make the group was $1.9 billion; this quarter it was $119 million. “However, the region is dealing with the global downturn much better than anticipated. While short-term performance will be affected, long-term outcomes are still looking positive.” Other regional IPOs in the top 20 list by capital raised included the UAE's Drake & Scull with $333 million, the UAE's Damas International with $226 million and two Saudi companies - Astra Industrial Group with $248 million and Methanol Chemicals/CHEMANOL with $193 million. China and Australia were placed first and third with 25 percent ($3.3 billion), and 10 per cent ($1.3 billion) respectively. The UAE came in second in the MENA region with $600 million, equivalent to 5 percent of global capital raised.
