Arab IPO Summit starts in Dubai with widespread participation from regional financial community

Against the backdrop of the continued expansion of the regional economy and changes in the capital markets across the MENA region, the first ever Arab IPO summit organised by UMS Conferences kicked off in Dubai today with widespread participation from senior officials across capital markets, stock exchanges, investment banks, and top companies to discuss the latest trends in the region and regulations on listings for issuers. Discussions at the Arab IPO Summit also focused on the latest developments, challenges and investment opportunities in the regional financial market. 

Richard Stockdale- Chartered Institute for Securities & Investment Board Member & President, UAE National Advisory Council spoke on the subject of Corporate Governance related to IPOs at the forum. According to Mr. Stockdale, "Governance is an integrated, well-practised and adhered to system underpinning quality management. A successful IPO flows from an intricate, interlinking, skilled and choreographed dance of at least seven specialist practitioners, all in the service of the Company. A successful IPO enhances the prospects of the company, investors, practitioners, regulators and the jurisdiction. Good governance is the vital common denominator that bolts the success together.”

Speaking on the subject of winning strategies for successful IPOs at the forum, Mayur Pau, MENA IPO leader, Ernst & Young, MENA said, “IPO activity in H1 2015 was driven by the IPO of several companies from Egypt and Saudi driven by positive market sentiment and regulatory reforms in the region. Following H1 2015, we have seen fluctuating market conditions in MENA, driven largely by global factors and fluctuating oil prices, which have resulted in several companies deferring IPO plans and waiting for the right time to go to market.  Timing and being IPO ready are critical to take advantage of the window of opportunity, which is typically short, as part of the IPO process. The importance of being prepared cannot be underestimated.”

The forum also saw an exclusive panel discussion on importance of IPOs for organizational and capital growth with participation from regulators and authorities like Dubai Financial Services Authority, Abu Dhabi Securities Exchange and Egyptian Exchange (EGX) among others. 

During the discussion, Brad Douglas Director, Markets, Dubai Financial Services Authority commented on the significance of IPOs as an important event in the lifecycle of any company. He spoke about the various benefits of IPOs such as access to initial and ongoing capital, incentivising employees through share schemes, managing for succession events, raising a company’s profile and generally broadening a shareholder base. He added that these benefits are principally achieved through companies adopting and applying robust governance and financial reporting regulatory standards that international investors understand and have confidence in.

Rashed Al Balooshi, CEO, Abu Dhabi Securities Exchange (ADX) said, “With our economy growing at a steady pace, ADX can attribute a good part of that growth to UAE business and industry, which generally have helped create prosperity in our society.  As a stock market, we have been a firm anchor in helping those businesses grow through IPOs. Our task is to ensure that companies find their way to the market and that ADX is always prepared to welcome new flotations. IPOs are undeniably one of the most significant events in the life cycle of any company as it expects higher economic growth, thus seeking more financing in order to fund capital investments. The liquidity created by going public provides owners, founders, and shareholders with an opportunity to collect on their investment, accordingly creating stronger capital and robust growth opportunities.”

“Current market conditions should not act as obstacles facing market activity and development,” said Dr. Mohammed Omran, Chairman, Egyptian Exchange (EGX). “Stock exchanges must create opportunities to overcome the internal and external challenges. That’s why the EGX follows a new strategy through approaching the business community and targeting promising companies to be listed on the exchange. In that context, we facilitate listing procedures and have reduced the required documents for listing, granted the Listing Committee more flexibility and created a team to promote listing activities. We will now also focus on continuing support for SMEs in addition to attracting public companies to have access to finance through the capital market.”