Gulf firms raise $4.8bn in IPOs

Middle Eastern companies, led by those in Saudi Arabia, sold $4.8 billion of stock in initial public offerings in the first-half compared with $8 billion in all of last year, accountants Ernst & Young said on Tuesday.

The $1.8 billion Saudi Kayan Petrochemical Co IPO was the biggest, followed by Dubai Islamic Bank's $883 million sale of stock in property unit Deyaar, Ernst & Young said in a statement.

In all, 20 companies, including 11 in Saudi Arabia, sold stocks in IPOs in the three months to June 30, raising $3.9 billion, the accountancy firm said. Saudi companies raised $2.56 billion, it said. It did not give comparative data for the first-half of last year.

"This reflected the growing capital base and confidence in the regional capital markets," Azhar Zafar, head of mergers and acquisitions services, is quoted as saying the statement.

Demand in the Middle Eastern IPO market, centred around the six Gulf Arab oil exporters, crumbled in last year as share prices collapsed across the region.

The average oversubscription rate for Gulf IPOs fell to 6.5 times in the first six months of this year from 60 times in the year-earlier period and 73 times in 2005, according to UAE private equity firm Gulf Capital.

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