Citigroup targets more deals in Gulf region

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Citigroup Inc’s investment banking team has doubled in size over the past two years and more people are being added in the United Arab Emirates (UAE) and Saudi Arabia, joining rivals seeking to take advantage of a red-hot Gulf IPO market.

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The Gulf region has become a bright spot for public share sales this year, boosted by high oil prices and government-led privatization programs.

Gulf issuers have raised about $16 billion in initial public offerings (IPOs) this year, accounting for about half of total IPO proceeds from Europe, the Middle East and Africa, Refinitiv data shows.

The growth in Gulf equity capital markets is in sharp contrast to the US and Europe, where global banks have been trimming headcount in a dealmaking drought.

Citigroup moved its director for power, renewables and utilities, Omar el-Duraie, to Dubai from London this year .

It is planning to add more people in Saudi Arabia and the UAE by the end of the year, said Miguel Azevedo, Citi’s head of investment banking for the Middle East and Africa, excluding South Africa.

“This year the region has been extremely active while the rest of the world has been on pause,” he told Reuters. “I expect next year to be very similar to this year.”

Many IPOs have had books covered within an hour or a few hours from opening. Some have increased the size of offerings during the process to accommodate strong demand.

Others expanding in the Gulf include Rothschild & Co, which has opened an office in Saudi Arabia, while Goldman Sachs is hiring bankers for its wealth management and investment banking businesses in the region.

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