Mena private equity market ‘poised for big growth’

20/04/2017 05:51 AST

The Mena private equity industry (PE) is poised for significant growth led by the GCC’s six member states in light of intensified Mena-wide economic diversification and development efforts, a report said.

This was the key finding of the report on ‘Challenges and Opportunities: Reinforcing the Private Equity Market in the Mena Region’ released by Orient Planet Research, an Orient Planet Group venture, on the sidelines of the inaugural Private Equity Forum & Awards 2017 held today (April 19) at the St. Regis Hotel in Dubai, UAE.

The research investigated some promising factors driving the regional PE industry as well as major challenges hindering it from reaching its full potentials in hopes of attracting substantial PE funding for home-grown markets and away from its historical role as a source capital for foreign investment. The International Monetary Fund has projected that Mena will become the third fastest-growing region in the world over the next five years.

Nidal Abou Zaki, managing director, Orient Planet Group, said: “A number of factors are making the region highly attractive to PE investors, including the regional governments’ strong initiatives to strengthen local entrepreneurship and promote small- and medium-sized enterprises.

“In addition, the region’s young demographics, increasing wealth, and recent important economic reforms are making it highly attractive to PE investors whose investments can help drive development and advance Mena’s position in the global stage.”

Khaled Abou Zahr, founder of the Private Equity Forum, noted: “The potentials of private equity investments in the Middle East and North Africa are enormous, and so are the challenges. But also it is important to highlight how the market is currently progressing in order to address current roadblocks that hinder success.

“The release of the report brings to our attention that the PE market is evolving and there are efforts from various sectors that attempt to shape its future in the region. The regional landscape is definitely changing and regional businesses are opening up to PE investors as revealed by the findings of the report.”

Emerging only in the late 1990s, Mena’s PE market is still at its infancy compared to other well-established ones such as the United States but many PE players are showing strong interest in the region. The report found that the UAE and Saudi Arabia received the bulk of PE investments in 2014 at more than 75 per cent of investments by value, while Egypt, Jordan, Tunisia and Lebanon carved a niche after accounting for 10 or more deals in 2015.

Further, the study learned that most PE investors prefer the UAE, Morocco, and Saudi Arabia where they expect to get high returns and an opportunity to diversify. Saudi Arabia is the region’s largest economy with a stock market worth more than $600 billion, making it larger than Russia’s and triple that of Turkey.

Many of the region’s economies have also embarked on diversification policies to reduce their heavy dependence on oil, leaving more room for expansion in vital sectors. Healthcare is an important sector that is attracting healthy interest among PE investors along with entrepreneurial- and technology-driven businesses, education, food and beverages, real estate, and hospitality.

Despite the opportunities, major issues such as continued conflicts are driving away substantial investments. Unflattering geopolitical headlines, weak oil prices, and reduced government spending have made regional PE challenging.

According to experts, from 2009 to 2013 around $180 billion was raised for PE for emerging markets but only $3.5 billion went to the Middle East. Lack of diversity is another concern that needs addressing, the report added.

The report noted that a number of public-private partnerships in important sectors such as healthcare, education, powe

Trade Arabia
Market News
2017 | 2016 | 2015 | 2014 | 2013 | 2012 | 2011 | 2010 | News Archive
Most Viewed Companies
Ticker Price Volume
QNBK 140.3 75,190
DAMAC 2.88 5,374,904
SABIC 98.84 2,628,815
BKMB 0.4 153,425
GMPC 4.11 161,018
ZAIN.TASI 10.2 1,103,646
Recent News

“Tadawul” Announces Approval of Securities Tick Size Amendment
The Saudi Stock Exchange “Tadawul” announces today the issuance of its Board resolution on 26/8/1438AH correspondent to 22/5/2017G approving the amendment of securities tick sizes.


Waha Capital agrees to sell its stake in UAE diagnostics business
Anglo Arabian Healthcare (AAH), Waha Capital’s healthcare portfolio company, has signed definitive documentation to sell its 93 per cent stake in Proficiency Healthcare Diagnostics (PHD) to Al Borg M

Bahrain business confidence index gains in Q2
The business confidence index in Bahrain has amounted to more than 19.91 positive points in the second quarter of 2017, according to a survey conducted by the Information & eGovernment Authority (iGA

Emirates Islamic announces renewed focus on millenials
Emirates Islamic has announced it has become the leading bank on Instagram in the UAE, as a result of its strategic focus on social and digital platforms to engage with customers and UAE residents an

Schon breaks ground on $871m hotel apartment project
Schon Properties, a leading private developer in Dubai, UAE, and Dubai Civil Engineering (part of Al Hamad Group of Companies), a leading mega projects construction company in the GCC, together broke

GulfBase GCC Index
Search By
  • Company Symbol
  • Company Name
  • Mutual Fund Name
  • News Content
Send this page to a friend


Looking ahead, what change you are more likely to make in investing in your domestic stock market?