The Mena region is seeing many deals from SPAC, indicating that the startup ecosystem in this region is attracting global players and giving a strong push to regional talent. The Special Purpose Acquisition Companies (SPACs) is a company formed to raise capital through an initial public offering (IPO) to acquire an existing company. SPAC has no commercial operations.
A major announcement of a SPAC deal was made in March of this year. Anghami, a leading music streaming platform in the Mena region went public by merging with a SPAC- Vistas Media Acquisition Company led by Mr. F. Jacob Cherian and co-founders Mr. Abhayanand Singh and Mr. Saurabh Gupta.
Another note-worthy SPAC deal done this year was by another startup company Swvl. It is a Dubai-based provider of mass transit and shared mobility solutions. Swvl recently merged with a SPAC- Queen’s Gambit Growth Capital, resulting in Swvl becoming a publicly-listed company. This SPAC is led by an all-women team. Swvl is expected to be the first $1 billion-plus unicorn from the Middle East to list on New York’s Nasdaq, with an implied, fully-diluted equity value of approximately $1.5 billion. Swvl is the only mass transit solutions company that is tech-enabled to list on any stock exchange so far. The deal between these two companies is expected to close by the end of this year.
Because of the evolving startup ecosystem of the Mena region, some of the largest local asset managers and sovereign wealth funds are also now actively considering listing their SPACs. Exciting times are ahead for local entrepreneurs that want to go public through SPAC listings. This way these companies will be able to gain much deserving access to growth capital from the major exchanges of the world. Egypt, UAE, and Saudi Arabia are the three major regions that are leading and contributing to the regional growth in Mena.
Tech companies in the Mena region do not have many options and usually settle for trade sales to international companies. These companies end up losing their independence and their brand in the process. However, things are looking upbeat with the SPAC merger with Anghami, and with Swvl going public on Nasdaq through a SPAC, we will see many more SPAC deals happening in the Mena region.