UAE dominates M&A activity in MENA region in H1 2025
MAYS IBRAHIM (ABU DHABI)The UAE has attracted nearly half of the MENA's total M&A value of $58.7 billion in the first half of 2025, according to the latest EY MENA M&A Insights report.The UAE captured investments worth $25.4 billion, mainly in chemicals, technology, industrials, and real estate. Meanwhile, the Kingdom of Saudi Arabia (KSA) received investments worth $2.5b in the first half of this year.Overall, the MENA region recorded 425 M&A deals between January and June 2025, marking a 31% increase in volume and a 19% rise in value compared to the same period last year. 'This performance builds on the steady flow of transactions seen in 2024, with strong momentum in early 2025 supported by regulatory reforms, policy shifts, and an improving macroeconomic outlook,' the EY report stated. Although deal-making slowed slightly in the second quarter amid global trade policies and regional conflicts, market sentiment remained positive with investors increasingly targeting sectors offering diversification and high-potential growth opportunities.'We are witnessing record-breaking cross-border activity as investors look beyond short-term volatility, actively pursuing scale, innovation, and new market opportunities,' Brad Watson, MENA EY-Parthenon Leader, said.'The UAE, 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.'The UAE was the clear leader in inbound M&A, capturing 50% of all inbound deals and an overwhelming 98% of inbound deal value across the region. The UAE also witnessed strong domestic activity, with 192 transactions worth $12.8 billion in H1 2025. Group 42's $2.2 billion acquisition of a 40% stake in Khazna Data Center was the largest local deal.Cross-border deals across the MENA region hit their highest level in five years, with 233 transactions worth $45.9 billion, accounting for 78% of total deal value. Chemicals and technology sectors dominated, making up 67% of cross-border deal value.Anil Menon, MENA EY-Parthenon Head of M&A and Equity Capital Markets Leader, noted that the MENA's strong dealmaking in 2025 reflects investor confidence in the region's long-term fundamentals. 'Stable oil prices, ongoing infrastructure development, and a strategic focus on technology, chemicals, and industrials are creating solid foundations for sustained activity,' he explained. '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.'Outbound activity reached 126 deals valued at $24.4b in H1 2025, up 30% in volume from the same period in 2024, according to EY. 'The UAE and KSA together accounted for 87% of outbound value, supported by government-related entities playing a major role.'Notable UAE-led moves included ADNOC and OMV AG's acquisition of Canada's Nova Chemicals.
Sovereign wealth funds and government-backed entities such as ADIA and Mubadala played a central role, driving $21 billion in deal value across chemicals, technology, and industrials.
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