GCC Investment Outlook 2018: The Year Of Transformation

DUBAI, 27 February 2018 – A report launched today by global law firm Hogan Lovells sets out key deal trends for the year ahead in the GCC.

"Investment Outlook 2018: Transaction and deal trends in the GCC" is our second annual report focusing on the macroeconomic trends affecting the investment market in the following 12 months.

The 2018 report finds that Gulf economies and markets have transformed in response to three years of low oil prices, new regional leadership and a global world order in flux.

The tougher fiscal environment and renewed drive to implement diversification are reshaping the region’s investment landscape – and acting as a catalyst for a more active M&A market, led by privatisation in Saudi Arabia, banking consolidation and the emergence of a dynamic technology sector in Dubai.

In 2018, positive macroeconomic drivers are adding a boost to Gulf markets. Key developments which we expect to see this year include:

• More clarity around the Saudi Aramco listing scheduled for the second half of 2018, plus a couple of other larger Saudi privatisations, mainly Saudi Electricity, Saudi Grains or the Tadawul itself.
• Sizable private IPOs, such as UAE headquartered GEMS Education proposed London listing and ACWA Power in Saudi, with the total value of new listings potentially setting a record even without Aramco.
• A pick up in M&A activity due to continued consolidation in the banking sector, a vibrant tech sector and privatisation initiatives in the region.
• More activity from sovereign wealth funds as they restructure their portfolios and invest inflows from privatisation.
• Progress in extending the public private partnership (PPP) model, after numerous false starts.

Imtiaz Shah, Head of Hogan Lovells' Middle East Corporate Practice said: "Despite improvements in the fiscal landscape in GCC countries, most Gulf states are continuing economic diversification and reforms which are required to improve their business environments and encourage investment.

This is an exciting time for investors, as relatively new markets become sources of great interest. For instance, with a rise in the need for digital solutions, high-growth tech companies aren't short of suitors willing to boost their cash flow. The consolidation of mature markets and privatisation will ensure a steady flow of M&A deals.

2018 is shaping up to be landmark year as previous groundwork translates into significant opportunities and regulatory changes open up GCC markets to further avenues of investment."

The full report is available to download at www.hoganlovells.com

***ENDS***

About Hogan Lovells

Hogan Lovells is a leading global law firm providing business-oriented legal advice and high-quality service across its exceptional breadth of practices to clients around the world.

"Hogan Lovells" or the "firm" is an international legal practice that includes Hogan Lovells International LLP, Hogan Lovells US LLP and their affiliated businesses.

The word "partner" is used to refer to a member of Hogan Lovells International LLP or a partner of Hogan Lovells US LLP, or an employee or consultant with equivalent standing and qualifications, and to a partner, member, employee or consultant in any of their affiliated businesses who has equivalent standing. Where case studies are included, results achieved do not guarantee similar outcomes for other clients.

For more information about Hogan Lovells, the partners and their qualifications, see www.hoganlovells.com. Where case studies are included, results achieved do not guarantee similar outcomes for other clients.