Mays Ibrahim (ABU DHABI)
The Middle East’s mergers and acquisitions (M&A) market is powering ahead even as global dealmaking slows, with the UAE retaining its position as the region’s top hub in the first half of 2025, according to PwC’s TransAct Middle East Mid-Year Update.
The UAE recorded 95 deals in the six months to June, accounting for more than a third of all activity across the region.
Despite a slight dip from 101 deals a year earlier, the UAE remains the undisputed leader in regional dealmaking.
Across the Middle East, M&A volumes rose 19% year-on-year to 271 deals, up from 228 in H1 2024.
This stands in sharp contrast with a 9% drop in global M&A volumes, as dealmakers grapple with slower growth in advanced economies, geopolitical fragmentation and new US tariffs.
“The Middle East has continued to show resilience and ambition in the first half of 2025 with deal activity growth in contrast to the global decline in M&A volumes,” said Romil Radia, Deals Markets Leader, PwC Middle Bast.
“The shift towards mid-market, high-impact deals shows a sharp focus on strategic assets - easier to fund and align with national goals like localisation, economic diversification and building digital and green infrastructure.”
Deal activity is being powered by the region’s sovereign wealth funds (SWFs), ongoing national reforms and diversification efforts across technology, energy and digital infrastructure, according to PWC.
Its report showed that GCC sovereign funds are increasing domestic allocations. For example, Abu Dhabi’s ADQ invested 85% of its capital locally in H1 2025, reflecting a strategic pivot toward industrialisation and localisation agendas.
Private equity activity also picked up, with 117 deals, while corporate buyers remained dominant, anchoring 154 deals.
Most of the growth has been in smaller transactions, according to the report. Nearly 96% of disclosed deals were under $100 million, with no megadeals above $5 billion recorded for the second consecutive year.
Egypt saw the sharpest increase in dealmaking, almost doubling to 86 transactions in H1 2025 from 48 the previous year. Gulf investment and IMF-backed reforms are supporting recovery, with GDP expected to grow 3.8% this year.
Saudi Arabia recorded 59 deals, up from 54, underscored by Vision 2030 priorities in technology and services. The Kingdom’s largest transaction was Elm Co’s $907 million acquisition of Thiqah Business Services, reinforcing Saudi ambitions to localise digital services.
The report showed that intra-regional transactions hit 134 deals, up from 118, showing stronger integration and investor confidence across the GCC and Egypt.
IPO activity also held steady, with 23 listings raising $4.1 billion.
Financial services was the most active sector, with 70 deals compared to 44 a year earlier. “The uptick reflects structural shifts across banking, insurance, and fintech, as institutions adapt to digital disruption, capital constraints, and regulatory reform,” the report said.
The IMF projects Middle East and North Africa GDP growth at 2.6% in 2025, up from 1.8% in 2024, led by non-oil sectors in the Gulf and improved macroeconomic stability in Egypt.