Blog 10 July 2023

Unlocking IPO Success in the Gulf

Five benefits of an experienced communications advisory for a successful public offering

The Gulf region has emerged as a vibrant hub for business and investment, spurred by this optimism companies increasingly considering initial public offerings (IPOs) to unlock growth potential and to tap capital markets. In navigating the intricacies of the IPO process, effective communication strategies are critical for establishing trust, transparency and credibility among complex stakeholder groups. Experienced communications advisors play a pivotal role in the process, helping guide and advise companies through this highly regulated process and making the difference between surviving or thriving during the process. 

Please find five key benefits of appointing strategic communications consultants, below: 

1. Building investor confidence: Communications advisors bridge the gap between companies and potential investors, addressing institutional as well as retail investors, the latter of which are a critical group during Gulf listings. Advisors bring specialized expertise in financial communications and investor relations, enabling businesses to craft and deliver compelling messages that convey growth prospects, competitive advantage, and long-term strategy. This encompasses preparing for early looks, analyst presentations, investor deep-dives, messaging around the intention to float, listing day and much more.  Communication advisors' support extends from the private phase to the public phase, where mature approaches to investor and analyst relations are necessary in order to satisfy mandated financial disclosure. 

2. Managing stakeholder expectations: Beyond their appeal to investors, IPOs attract a range of stakeholders, including employees, customers/clients, suppliers, regulators and exchanges. Effective communication plays a vital role in managing their expectations and ensuring a smooth transition. Communications advisors can assist with internal and external communication needs, keeping employees informed and engaged throughout the IPO process. They also support businesses in communicating with customers, suppliers and regulatory bodies, fostering transparency and maintaining trust. 

3. Shaping public perception: The success of an IPO heavily relies on public perception, particularly in Gulf markets where retail investor participation is significant. Communications advisors help businesses effectively tell their story, highlight achievements, and address any misconceptions through a considered approach to media relations. They also manage social media engagement, enabling businesses to connect directly with the public, address concerns, build brand awareness and foster a positive reputation in the marketplace. 

4. Navigating the cultural landscape: The Gulf region's cultural diversity requires an understanding of local customs, language preferences, and communication norms. What works on the Muscat Stock Exchange may not work in Abu Dhabi – and for dual-listings additional considerations must be made around how these listings are communicated. Communications advisors with regional expertise can develop strategies that resonate with the target audience, ensuring culturally appropriate messages that engage stakeholders effectively. Combining international lessons learned with regional know-how and cultural nuances can help businesses optimize their communication efforts and strengthen their IPO preparations. 

5. Mitigating risks and crisis communication: Given the complexity and unpredictability of the IPO journey —and the many unforeseen circumstances that may arise— communications advisors experienced in crisis communications serve to manage and mitigate risks during the IPO process. They develop robust crisis management strategies and protocols, including leak strategies that dictate roles and responsibilities during cases of accidental disclosure of information. Additionally, they handle negative events internally or externally and provide context for market fluctuations that may impact the IPO process. Close coordination with legal advisors ensures regulated publicity efforts, while transparent and timely communication safeguards the reputation of Gulf-based businesses, maintains investor confidence and ensures business continuity. 

In the Gulf business landscape, effective communications in both Arabic and English are pivotal to IPO success. Businesses, banks, and advisory firms preparing for an IPO in the Gulf region would do well to consider appointing experienced communications advisors. By leveraging the insights and capabilities of these advisors, Gulf-based businesses can strengthen their IPO preparations and delivery - ultimately enhancing chances of success.