RIYADH: Middle East and North Africa mergers and acquisitions rose 19 percent in the first half of 2025 to $58.7 billion, driven by sovereign wealth funds, cross-border flows, and strong deal activity in the UAE and Saudi Arabia.
According to the latest EY MENA M&A Insights report, the number of transactions jumped 31 percent year on year to 425, marking one of the busiest half-year periods for the region.
The findings come alongside data from the London Stock Exchange Group, which reported last month that MENA M&A surged 149 percent in the same period to $115.5 billion, the highest first-half total since 1980.
Earlier in February, US-based investment bank Morgan Stanley described the M&A momentum in the region as a “structural upswing” in deal volume and value, driven by regulatory reforms and strategic policy shifts across the region.
“The positive performance in the first half of 2025 underscores the strength, dynamism, and resilience of MENA’s M&A market,” said Brad Watson, MENA EY-Parthenon leader.
He added: “We are witnessing record-breaking cross-border activity as investors look beyond short-term volatility, actively pursuing scale, innovation, and new market opportunities.”
UAE and Saudi Arabia dominate
The UAE dominated regional activity, attracting $25.4 billion worth of deals, while Saudi Arabia recorded $2.5 billion. Transactions were concentrated in chemicals, technology, industrials, and real estate.
“The United Arab Emirates, in particular, remains a magnet for global capital, supported by a stable regulatory framework and a focus on economic diversification, while regional partnerships with Europe, Asia, and North America are opening doors to fresh growth channels,” said Watson.
Cross-border transactions within the region reached their highest level in five years, making up 55 percent of total deal volume and 78 percent of total deal value, amounting to 233 deals worth $45.9 billion.
The chemicals and technology sectors dominated, contributing 67 percent of cross-border deal value, highlighted by major transactions such as Borealis AG and OMV AG’s $16.5 billion acquisition of a 64 percent stake in Borouge plc.
Compared to the first half of 2024, cross-border deal volume rose 40 percent, while value increased 7 percent, signaling growing international investor confidence in the MENA region.
Regional growth mirrors global trends, with WTW, a global advisory and insurance firm, reporting 339 deals worth over $100 million worldwide in the first half of 2025, up slightly from 332 a year earlier.
In July, Devvrat Gaggar, Middle East M&A consulting director at WTW, said “geopolitical uncertainty may be the new normal, and dealmakers are adapting by finding ways to generate long-term value.”
He added: “While North America is lagging, Europe, Asia, and increasingly the Middle East, are seeing renewed confidence and momentum in dealmaking.”
Domestic deals
Domestic M&A activity remained robust, with 192 deals worth $12.8 billion, marking a 22 percent increase in volume and a 94 percent surge in value year on year, according to EY.
Key sectors included diversified industrial products and technology, which accounted for over half of domestic deal value. The largest domestic transaction was Group 42’s $2.2 billion acquisition of a stake in Khazna Data Center.
Inbound M&A also saw a sharp rise, with 107 deals worth $21.5 billion, a 53 percent increase in volume and a 235 percent jump in value compared to the first half of 2024.
The UAE was the top destination, capturing 50 percent of inbound deal volume and 98 percent of inbound value. Austria emerged as the leading investor, contributing 77 percent of inbound deal value, largely due to a major chemicals sector transaction.
Outbound investments
Outbound M&A from the MENA region reached 126 deals valued at $24.4 billion, up 30 percent in volume from the first half of 2024. The UAE and Saudi Arabia dominated outbound flows, accounting for 87 percent of total outbound value, with government-related entities playing a key role.
Notable deals included oil giant ADNOC and OMV AG’s acquisition of Canada’s Nova Chemicals.
Government-related entities and sovereign wealth funds were major drivers, contributing $21 billion across 54 deals. Leading players such as the Abu Dhabi Investment Authority, Saudi Arabia’s Public Investment Fund, and Abu Dhabi’s Mubadala focused on chemicals, technology, and industrials, aligning with long-term economic diversification strategies.
“MENA’s dealmaking continues to thrive in 2025, reflecting investor confidence in the region’s long-term fundamentals,” said Anil Menon, MENA EY-Parthenon head of M&A and equity capital markets.
He added that stable oil prices, continued infrastructure development, and a strategic focus on technology, chemicals, and industrials are laying strong foundations for sustained growth.
“As the year progresses, we expect intensifying competition for high-quality assets, particularly those that align with national transformation agendas and offer strategic value beyond financial returns,” said Menon.
Outlook for the rest of 2025
While the second quarter of the year saw slight moderation due to evolving global trade policies and regional conflicts, EY said “overall market sentiment remained positive, with deal-making driven by diversification strategies and growth in high-potential sectors.”
With regulatory reforms, policy shifts, and an improving macroeconomic outlook, the MENA M&A market is poised for sustained growth, particularly in technology, energy transition, and cross-border investments.
PwC’s Global M&A Industry Trends report indicated a promising growth outlook for dealmaking, with key sectors such as entertainment and media, technology, aerospace and defense, and financial services experiencing rising deal values, fueled by an increase in megadeal activity.
