(Bloomberg) — The Middle East, a bright spot for new share sales for four years, faces a significant challenge from the recent volatility in equity markets and a slump in oil prices. Even so, bankers are hopeful that dealflow will resume in coming weeks.
Unlike a raft of companies in Europe and the US, Middle Eastern firms planning to go public later this quarter haven’t yet postponed plans, according to bankers working on the deals. The region is relatively insulated from US tariffs and many of the businesses considering listing are heavily tied to fast expanding local economies, they said.
EFG Hermes, which arranged the most IPOs in the Middle East last year, still expects to bring six to seven more deals to market in 2025 — primarily in Saudi Arabia, in addition to a potential deal in Kuwait, a senior banker said. JPMorgan Chase & Co. also hasn’t yet seen significant changes to its regional pipeline for this year, or to more preliminary discussions with companies looking to list in 2026 or 2027.
“We’re still on track,” said Mostafa Gad, global head of investment banking at EFG. None of Gad’s deals have been postponed or canceled, and internal preparation for new share sales continues.
Those comments come against a backdrop of lingering risks — markets remain volatile and concerns about global growth abound. Global assets from stocks to bonds have seen sharp swings in recent days as US President Donald Trump imposed sweeping global tariffs and then went on to pause most of them.
The oil-exporting Gulf could take an economic hit with crude prices plunging below $65 a barrel after a surprise OPEC production hike and concerns that the tariffs could spur a global slowdown.
“If we see bigger pressure below the $60 mark, then you start seeing some alarms,” Gad said. “Then you’ll wait and see how the governments want to react. They will either be very cautious about the deficits and start cutting spending or they say, look it’s temporary, let’s live with a bigger deficit for a little bit of time and then figure it out.”
In Abu Dhabi, flagship carrier Etihad Airways PJSC has been lining up an IPO since last year. Meanwhile, Dubai Holding LLC, a vehicle controlled by the emirate’s ruler, had been weighing a listing of a residential real estate portfolio as early as this month, according to people familiar with the matter. Executives at both firms continue to monitor markets and no decision has been made on the timing of the deals, people familiar with the matter said. Representatives for Etihad and Dubai Holding declined to comment.
JPMorgan’s head of equity capital markets for Central Eastern Europe, Middle East and Africa, Gokul Mani, said his Middle Eastern pipeline hasn’t been affected.
“Transactions that might have been looking to launch this week or next week will probably get delayed to a couple weeks further out, but that’s to be expected given global volatility and disruptions to supply chains,” Mani said.
Still, investors are growing more discerning, and he expects mainly higher quality companies will be able to get their deals done.
A smattering of Saudi Arabian companies had their IPO plans greenlit by the regulator just before the Eid holiday last month, including low-cost carrier Flynas, gym chain operator Sports Club Co., hospital operator Specialized Medical Co., Al Majed Real Estate Company and Marketing Home Group Co. Tech firm Ejada Systems and packaging firm United Carton Industries Co. also have regulatory approvals to list.
Even so, talk of new listings may be too premature for some investors as they focus on navigating the turmoil and finding opportunities. “I think it’s a bit too early to say as volatility is still very high on all the financial parameters that affect any valuation,” said Christian Ghandour, senior portfolio manager at Al Dhabi Capital.
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