Standard Chartered Plc expects to complete private equity deals in the Middle East in 2010, but sees the unhealthy IPO market and a price expectation gap between buyers and sellers as barriers to the sector's revival.
Labib Taimoor, recently named head of the emerging markets-focused British bank's private equity business for the Middle East, North Africa and Turkey, is eyeing opportunities in the manufacturing, health and retail sectors with a focus on the United Arab Emirates and Saudi Arabia.
"Generally speaking things should improve going forward. Investors and owners feel more comfortable about the business and macro environment," Taimoor said.
"One challenge is still the gap between sellers and buyers. Family-owned businesses which have been around for generations think highly of their companies," Taimoor said.
"The other issue is exits: IPO markets have been frozen for the last couple of years. We are seeing some improvement. Once the UAE IPO market picks up as well that will be very helpful to our business," he said.
Private equity investors typically make money by acquiring a business and then selling it on at a profit via an initial public offering (IPO) on a stock market.