The Middle East’s mergers and acquisitions (M&A) landscape has demonstrated remarkable resilience and growth in the first half of 2024, with total deal values reaching $49.2 billion across 321 transactions. This performance contrasts sharply with the global M&A market, which has experienced a downturn during the same period.
A significant portion of this activity is attributed to sovereign wealth funds (SWFs) and government-related entities (GREs) in the United Arab Emirates (UAE) and Saudi Arabia. These institutions have been instrumental in driving deal volumes, particularly in sectors aligned with economic diversification and technological advancement. Notably, the UAE and Saudi Arabia, along with Egypt, accounted for 88% of the region’s deal volume, underscoring their pivotal roles in the M&A landscape.
In the UAE, the financial services sector has been particularly active. A standout transaction involved Agility Global PLC, which distributed a 49% stake as dividends to shareholders, valued at $2.196 billion, before pursuing an initial public offering in Abu Dhabi. This deal represents the largest in the financial services sector during this period.
Saudi Arabia has also witnessed significant M&A activity across various sectors, including industrial manufacturing, consumer markets, financial services, and energy. A notable transaction is Qassim Cement Company’s $378 million acquisition of Hail Cement Company via a share-swap, reflecting the ongoing construction boom ahead of the 2030 Expo and the 2034 FIFA World Cup bid.
The real estate sector has emerged as a major contributor to deal value, with 15 deals amounting to $1.3 billion. This surge is driven by increasing tourism, upcoming mega projects, and a growing middle-class income. The consumer products and technology sectors have also been active, witnessing 47 deals in the domestic market, representing 30% of the total volume.
Outbound M&A activity has been robust, with 96 deals amounting to $36.3 billion, marking a 19% increase in value compared to the same period in 2023. The insurance and real estate sectors accounted for 57% of the deal value in this space, mainly resulting from two deals involving MENA-based SWFs. The United States and China contributed 75% of the total outbound deal value.
The Middle East’s M&A market has also seen increased activity in the digital infrastructure sector. The telecom landscape is transforming, with TowerCo penetration soaring and driving a wave of passive infrastructure M&A.
Despite a 4% decline in deal volume compared to the first half of 2023, the Middle East’s M&A market has outperformed global trends, which have seen a 25% drop. This resilience is attributed to strategic government initiatives focused on economic diversification, green economy initiatives, tech advancements, and an emphasis on localization and value creation.
