The IPO + M&A outlook in Saudi Arabia, according to EFG Hermes KSA’s CEO: As Saudi Arabia’s capital market continues to attract international attention, we caught up with our good friend Saud Altassan (Linkedin), CEO of EFG Hermes Saudi Arabia, to discuss the firm’s approach to navigating market dynamics and its positioning in an increasingly evolving and competitive industry.

Edited excerpts from our conversation:

Diversification in offerings is key to attracting new investors: As part of the Kingdom’s strategic shift toward economic diversification, we are focusing on attracting institutional and foreign investors to the domestic market. By diversifying the sectors we bring to the table, we’ve generated significant foreign interest. This variety enables us to engage institutional investors who may have not been interested in traditional public sector offerings.

The hottest sectors right now are healthcare and education. We’ve been very active in both, with a dedicated education fund, and we’re also working on an IPO in this space. Healthcare is another sector that is ripe with opportunity, and we’re involved in most of the major transactions there, both IPOs and private sector transactions. Outside of these, we’re also looking at renewables and energy, which are increasingly attractive to foreign investors. Our IPO and M&A transactions span a wide range of industries, including healthcare, education, facility management, car rentals, and more.

We’re working on two high-profile major IPOs right now. One of them will definitely happen this year, and we’re optimistic about the second one, though it might extend into next year.

We have the largest investment banking team on the ground and we are one of the largest foreign brokers in the region. We also have the best research team in the region, and it’s our in-depth coverage that sets us apart. Our analysts don’t just cover companies in Saudi Arabia; they cover the entire region, which gives us unparalleled insight into various sectors. This allows us to provide investors with unique perspectives and benchmarking that others can’t offer.

EFG Hermes KSA sets itself apart with deep local expertise, complemented with regional and international experience that is backed by a strong track record of some of the biggest transactions in the region. By leveraging our top-tier in-house research capabilities, international reach, and extensive connections with the largest institutions both in Saudi Arabia and globally, we are able to offer more value than any of our competitors in the domestic market.

ESG + sustainability in focus: As demand for impact investments, ESG factors, and sustainable practices continues to grow, we’ve made these priorities central to how we structure most of our transactions.

We anticipate a rise in IPO activity in the coming years, driven by strong performance and increasing demand for growth as the market matures. At the same time, the M&A market is poised for more activity, particularly as companies seek to scale rapidly. M&A remains one of the quickest paths to growth, and with investors becoming more sophisticated, this will continue to be a key driver of market momentum.

The downside risks: Geopolitical risks are something we’re always mindful of, particularly as we operate in the Middle East. But Saudi Arabia has shown incredible resilience. We’re hopeful that political stability will continue, which bodes well for the financial sector. For us, the challenge is really to continue what we’ve been doing — leveraging our strengths and staying on track.

ICYMI- We also recently sat down with EFG Hermes’ Head of Research Ahmed Shams El Din for a chat about sectors driving growth in the local market, untapped potential in real estate, and shift in investors’ mix.

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