Mergermarket, the world’s leading intelligence and news service for mergers and acquisitions, today hosted the ‘Saudi Arabia M&A and IPO Forum’ in Riyadh. The Forum featured live discussion by a number of the Kingdom’s top-ranking investment professionals. Speakers and panellists included representatives of Tadawul, Investcorp, Mobily, Saudi Fransi capital and EY MENA, who launched their ‘October 2014 Capital Confidence Barometer’ at the event. 

Key topics that were addressed in the course of the day included recent changes to capital markets regulation in the Kingdom, and the likely impact that would have on foreign investment in Tadawul listed companies. Discussions also focused on the approach of Saudi family businesses to growth and investment, including partnering with foreign firms, acquisitions and disposals. Perspectives on the subject were provided to delegates by senior representatives of Alturki Group, Asyad Holding, and SEDCO Holding. 

Ms. Ruth McKee Al Ghamdi, Head of Middle East & North Africa, Mergermarket, commented: 

“The outlook is optimistic for M&A in Saudi Arabia driven by a growing population, demand for services and increasing wealth as well as the opening up of the stock market to foreign investors planned for next year. M&A activity is expected to be both domestic and intra-regional and businesses that have benefited from economic growth will look to M&A to accelerate their growth.”

Panellists also addressed the evolution of private equity activity within the Saudi economy, considering the varied investment strategies of Saudi-based and GCC-focused private equity investors. Ms. McKee Al Ghamdi continued: 

“As private equity becomes more established some exits are expected along with new funds and investments. Sectors of note are education, healthcare and consumer and food and beverage, the same sectors family businesses are showing particular interest in. Other sectors that will see M&A activity include, retail, financial services and real estate.”

Commenting on the ‘October 2014 Capital Conference Barometer’, Mr. Phil Gandier, MENA Transaction Advisory Services Leader at EY, said:

“The October 2014 EY MENA Capital Confidence Barometer contains some of the strongest indicators pointing to healthy growth leading up to the levels in M&A and capital confidence in the last few years. Business and economic growth are positive, which has led to a larger deal pipeline supported by strong business performance, particularly in the GCC countries. High cash levels for MENA businesses, diminishing valuation gaps between buyers and sellers, and promising M&A pipelines make the business environment conducive to more deal closures and transactions with more than half of our respondents stating that they expect to pursue an acquisition over the next 12 months. Executive optimism remains high due to the expectation of strong corporate earnings, improving credit availability and market stability. The rising capital market activity will continue to provide a positive outlook for liquidity in the markets and MENA businesses are expected to focus on expanding their core offering into new markets.”

The ‘Saudi Arabia M&A and IPO Forum’ took place at the Ritz Carlton, Riyadh, with the aim of discussing recent investment trends in the Saudi Arabian market, as well as providing a forward looking analysis of the main deal drivers likely to be seen in the GCC during the next 6-12 months. Mergermarket’s lead strategic partner was EY MENA, in addition to strategic partners Kroll, Instinctif Partners and Advert One.