What's Happening?
The Middle East and North Africa (MENA) region experienced a significant increase in mergers and acquisitions (M&A) activity during the first half of 2025, according to research from EY-Parthenon. The total number of deals closed reached 425, marking a 31% increase compared to the same period in 2024. The total deal value rose by 19% to $58.7 billion. This growth was driven by various factors, including regulatory reforms, policy shifts, and an improving macroeconomic outlook. The United Arab Emirates (UAE) led the region with $25.4 billion in M&A deals, accounting for nearly half of the total transactions. Cross-border deals also reached a five-year high, with 233 deals worth $45.9 billion, representing 55% of total deal volume and 78% of total deal value.
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Why It's Important?
The surge in M&A activity in the MENA region highlights the growing investor confidence in the region's economic stability and potential for growth. The UAE's dominance in the M&A scene underscores its role as a hub for global capital, supported by a stable regulatory framework and economic diversification efforts. The increase in cross-border transactions indicates a strong interest in expanding market opportunities and pursuing innovation. This trend is likely to attract more international investors and could lead to further economic development in the region. The focus on sectors like technology and chemicals aligns with national transformation agendas, offering strategic value beyond financial returns.
What's Next?
As the year progresses, competition for high-quality assets is expected to intensify, particularly for those that align with national transformation agendas. The ongoing focus on technology, chemicals, and industrials is likely to continue driving M&A activity. Government-related entities and sovereign wealth funds are expected to remain key players in the M&A landscape, targeting sectors that support diversification goals. The region's stable oil prices and infrastructure development will continue to provide a solid foundation for sustained M&A activity.
