Bold and bigger deals fuel transformative growth in the region: PwC's 2025 TransAct Middle East report
Large-scale transactions in Artificial Intelligence (AI), renewable energy and infrastructure have fueled the region's M&A momentum and are expected to continue driving dealmaking.
Saudi Arabia, the UAE, and Egypt accelerate initiatives to attract private sector investment.
Sovereign wealth funds and corporations are actively expanding their global footprint, positioning themselves for an even bigger push in 2025.
In the Middle East, there was a slight uptick in private equity (PE) deal volumes with inbound deals playing a significant role in PE activity, totalling 108 transactions.
While only one regional deal exceeding US$1bn was recorded in 2023, 2024 saw five such deals, with the largest reaching US$3.6bn highlighting growing investor confidence in the region.
Dubai, UAE: PwC Middle East has released its latest TransAct Middle East report titled, Bold moves: Big bets, bigger growth, highlighting key mergers and acquisitions (M&A) in the Middle East in 2024. According to the report, the region's dealmaking landscape was driven by a growing emphasis on innovation and sustainability across various sectors.
Despite global headwinds, Middle East deals volumes experienced a modest decline of only 4% - from 493 deals in 2023 to 475 in 2024 - significantly outperforming the global market's decline of 17% and showcasing the region's resilience in M&A activity. Large-scale transactions in AI, renewable energy, and infrastructure have fueled the region's M&A momentum.
Romil Radia, Deals Markets Leader, PwC Middle East, stated: 'In 2024, the Middle East's M&A market demonstrated remarkable resilience and confidence, driving strategic investments in sectors such as AI, renewable energy and infrastructure. The region saw a notable rise in large-ticket deals, reflecting the bold ambitions of investors to accelerate regional diversification, bringing in new capabilities and strategic expertise to strengthen key industries and help develop the newer sectors.'
He continued, 'Sovereign wealth funds and Middle East corporates are actively expanding their global footprint, positioning themselves for an even bigger push in 2025.'
Key themes arose within the regional M&A market in 2024 with examples such as:
Technology and AI drives business reinvention: Bayanat AI's US$1.5bn acquisition of Al Yah Satellite Communication has reinforced its leadership in advanced technology. Moreover, Qatar's Ooredoo secured US$550mn to expand AI and data centre infrastructure, further strengthening the region's digital transformation. Meanwhile, Saudi Arabia's 'Project Transcendence,' a US$100bn AI investment initiative, underscores the country's long-term commitment to deep tech and innovation.
Sovereign Wealth Funds (SWFs) continue to shape homegrown economic growth: SWFs continue to prioritise investments in local businesses, industries and projects, where dealmaking will likely increase in sectors critical to the region's long-term economic goals. This could lead to a greater number of domestic deals as companies look to align with national priorities and regulatory frameworks that support local development.
Green energy transitions drive new investment strategies: Masdar's US$2.7bn acquisition of Greece's Terna Energy highlights the Middle East's leadership in renewable energy, reinforcing its commitment to sustainability.
Increasing private participation aids diversification: Saudi Arabia's healthcare sector now sees 53% of investments coming from the private sector, reflecting the country's push toward economic diversification. Meanwhile, Egypt's historic US$35 billion ADQ-led investment deal marks a significant step in its privatisation efforts, attracting foreign capital and fostering private sector growth across key industries.
Global PE could fuel Middle East M&A boom: The global private equity market saw a surge in large-scale transactions, with the number of deals valued over US$1bn rising from 430 in 2023 to over 500 in 2024, driving an 11% rise in average deal sizes. This reflects the global trend of increased asset supply expected to come to the market, driven by the increasing pressure on PE players to exit mature portfolio company investments. In the Middle East, there was a slight uptick in PE deal volumes with inbound deals playing a significant role in PE activity, totalling 108 transactions. Additionally, while only one regional deal exceeding US$1bn was recorded in 2023, 2024 saw five such deals, with the largest reaching US$3.6bn highlighting growing investor confidence in the region.
The Middle East's M&A landscape is expected to continue its expansion, with over 50% of regional CEOs planning acquisitions within the next three years. AI, digital transformation, and sustainability are expected to drive dealmaking, while Saudi Arabia, the UAE and Egypt accelerate privatisation to attract private sector investment. Additionally, cross-border M&A and rising foreign investment are expected to reshape the market, further solidifying the region's position as a global economic hub.
The continued creation of new sectors and sustained investment in high-growth areas should provide globally-minded corporations with compelling incentives to invest in the region. These factors will empower dealmakers to unlock significant growth opportunities in 2025 and beyond.
About PwC
At PwC, our purpose is to build trust in society and solve important problems. We're a network of firms in 149 countries with more than 370,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.
Established in the Middle East for over 40 years, PwC Middle East has 30 offices across 12 countries in the region with around 12,000 people. (www.pwc.com/me).
PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.
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