Mideast IPOs boom despite downturn in world market

Dubai: Initial public offerings in the Middle East have shrugged off a global market downturn this year and would continue to as an economic boom fuelled by high oil prices boosts liquidity, Ernst & Young said yesterday.

Some 33 companies in the Middle East, including the Gulf oil producers, raised $8.69 billion by selling shares to the public in the first half of the year, a surge of 79.9 per cent from the same period last year, Ernst & Young said.

Around the world, total capital raised in IPOs fell 59 per cent to $37.4 billion in the second quarter compared with the same period last year, with the number of offerings slashed by more than half, the consultancy firm said.

During the same period, Middle East IPOs raised 21 per cent more than they did in the second quarter of 2007.

"The region has shown some resilience as a result of liquidity created on the back of continuously increasing oil prices," Phil Gandier, a manager at Ernst & Young Middle East, said in the report.

Oil prices have risen more than six-fold since 2002.