Kentz shows there is still life in the world’s financial markets

In the current climate, it is nice to be able to applaud a bit of financial sang froid. Kentz Corporation, an engineering group that does a lot of business in the Middle East, yesterday pulled off an IPO on the Alternative Investment Market in London, the first since the “perfect storm” that hit the world’s markets a couple of weeks back.

True, it was not the biggest offering the world has ever seen – at a placing price of $2.27, Kentz is valued at $264.4 million (Dh970m) [the shares even added a bit in early trading]. But in the current climate to get anything away at all is an achievement. The anecdotal chit-chat is that many potential IPOs have been pulled at the last minute by advisers worried about world market volatility.

Kentz, under CEO Hugh O’Donnell, is something of a turnaround story. It specialises in energy, petrochemical, and mining and metals, and has a long list of clients in the UAE and other Gulf countries, but it also has operations further afield, from Indonesia to Ireland. Its clients include some of the biggest energy and contractor groups in international business, like Shell, ExxonMobil, Mittal Steel and Bechtel.

The listing shows that there is still life in the capital markets, despite the volatility of recent weeks. Kentz, and its adviser, stockbroking firm Evolution Securities, obviously believe their energy, minerals and infrastructure-related operations are as immune to economic recession as it is possible to be in the current global uncertainty.

If they are right, and the shares flourish, the logical next step would be a listing on one of the UAE markets. It is about time a British corporation had the nerve to put a toe in the waters of the Gulf’s financial markets.