“Islamic finance saw a record year and was the preferred funding option for many growth businesses.”
Azhar Zafar,
Middle East and North Africa IPO Leader,
Ernst & Young

The Middle East’s IPO scene stalled last year as issuers and investors worried about market volatility, economic uncertainty and the consequences of political change.

Total funds raised stood at US$929.9m in 2011, a 68.5% decline on 2010. But the number of IPOs in the pipeline across the region continues to grow. When the economic outlook improves and investors regain their confidence, there’s the potential for a flood of deals.

Islamic financing is strong

With the IPO markets effectively closed in some cases, the region’s growth companies increasingly turned to other sources of capital. Islamic funding such as Sukuk — a form of bond — saw a record year and was the preferred funding option for many growth businesses.

Saudi Arabia was the leading IPO market

Saudi Arabia raised the most money overall — US$417.8m — and saw the second–largest IPO on a Middle East exchange. Africa saw 14 IPOs worth US$886m in 2011, with 4 South African deals in the real estate and consumer products sectors driving activity.

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