In 2007 alone, recent reports have revealed that IPOs in the region have raised a combined total of $12.8bn, essentially powered by a strong performance in the last two quarters during which a total of $8bn was generated. impaQta warned though that several more companies have failed to fully capitalise on the advantages of going public primarily because of issues related to a lack of transparency.
Rashad Kanbar, Chairman of the Board of Directors, impaQta, commented:
“Our region has witnessed a number of IPOs in the last three years with a handful in the range of billions. The government has played an important role in this emerging trend by encouraging companies to share the wealth with the public through IPOs. In 2008, I believe it will be a very busy year in the GCC capital market as we anticipate major changes in the landscape.”
“impaQta has prepared adequately for this by boosting our business and advisory services portfolios and increasing our presence in high-growth areas to help a large number of companies in the region that fall short in developing a clear vision and strategic objectives to target going IPO. These businesses are run today the same way they used to run 20 years ago. This is not the way to go IPO,” added Kanbar.
With transparency being one of the key elements to a successful IPO, Kanbar stressed that companies must work on improving corporate governance, strengthening the company’s board and committees, and adopting a proper structure. He also said that organisations must have the right strategic approach and not just take IPOs as a way to generate more money, but more as an avenue to boost growth and unleash full potential.
“Organisations must have the right attitude from day one to ensure success. Without adequate preparation, panic starts when companies are taken to IPO and it may take years to audit and consolidate financial statements,” said Aiman Said, Chief Executive Officer, impaQta.
“As such, it is important to acquire the services of a reliable, knowledgeable and highly experienced advisory team that will facilitate the whole process and maximise the firm’s IPO potential. It has been impaQta’s experience that clients that have the right mindset towards IPOs and have been diligent in taking the necessary precautions and preparatory steps have succeeded immensely despite the huge challenges,” added Aiman Said.
Without an experienced and highly capable management advisory team, executing IPO can be a long and stressful process to most organisations, causing significant disturbance to core operations, particularly because the whole process is usually too complex and involves several legal parties, advisors, bankers, PR and marketing arms and other resource-intensive factors.
The challenges when going IPO include selecting the right partners, internal restructuring to improve performance in preparation for the IPO, market condition assessment and choosing the appropriate time to go IPO, lack of middle management, unavailable documentations, internal capabilities, and tight deadline and time frames.
“Although we still have a long way to go towards more mature capital markets, I think we are in the right track as our region has been categorized as one of the most promising in the world. Accordingly, as one of the key players in this sector, impaQta has made a significant difference in addressing the region’s key challenges, helping regional clients develop strategies, initial business plans, build internal capabilities and structure, manage the entire process and all the way to securing underwriting to multi-billion transactions,” concluded Kanbar.
impaQta has rapidly expanded its advisory team from three to 25 top-notch consultants from the Arab World since it was established in 2004. With its consultants’ collective experience covering several domains and industries, impaQta has gathered an impressive portfolio of clients that includes prominent players in real estate development, investment, financial services, and telecommunications
Wednesday, February 20- 2008 @ 10:32 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.