The Middle East has emerged as a central player in the global mergers and acquisitions (M&A) market, with deal activity in the region surging by 88% year-on-year to $36 billion in the first ten months of 2024, according to Bain & Company. This growth is driven by sovereign wealth funds and government entities in Saudi Arabia and the UAE, which are leveraging their capital and strategic focus to dominate domestic and international markets.
“The Middle East’s exceptional M&A growth underscores the region’s transformation into a global investment powerhouse,” said Grégory Garnier, Middle East Head of Bain’s Private Equity and Sovereign Wealth Fund practices. Key sectors such as energy, technology, and advanced manufacturing have seen significant activity, with year-on-year increases of approximately 140%, 90% and 300% respectively. This reflects a broader shift towards innovation and sustainability, positioning the region as a critical driver of global economic growth.
Global M&A trends in 2024
Globally, Bain & Company predicts that overall M&A deal value will reach $3.5 trillion by the end of 2024, representing a 15% year-over-year increase and signalling a reversal of the two-year decline in deal activity. Deal volume has also risen by 7% year-over-year, marking a return to mid-2010s levels. However, the M&A landscape has been shaped by dealmakers adapting to higher interest rates and heightened regulatory scrutiny, extending close timelines and reshaping the types of transactions being pursued.
Scale deals have dominated globally, accounting for 59% of total deal value—the highest proportion since 2015. This trend has also been reflected in the Middle East, where large-scale transactions are helping to consolidate leadership in key industries such as energy and advanced manufacturing.
Strategic focus in the Middle East
Middle Eastern investors have increasingly prioritised European targets, with investments in Europe growing by over 100% year-to-date compared to 2023. This reflects a strategic realignment toward regions offering better value and regulatory stability. The Middle East’s favourable regulatory environment has further bolstered its appeal to global investors seeking efficiency in deal execution.
Sovereign wealth funds and leading regional players leverage revenue and cost synergies in high-value transactions. This disciplined approach has attracted significant global capital, further reinforcing the region’s position as a hub for strategic M&A activity.
Adapting to higher interest rates
Globally, dealmakers have adjusted strategies to navigate the challenges of persistently high interest rates. Strategic acquirers are increasingly selective, focusing on deals with clear value-creation opportunities. Middle Eastern dealmakers have exemplified this adaptability by carefully targeting transactions that align with their long-term growth objectives.
Regulatory challenges have also played a significant role in shaping the M&A landscape. Nearly half of global dealmakers reported that regulatory concerns influenced the deals considered in 2024. In contrast, the Middle East offers a more favourable environment, enabling quicker deal closures and predictable outcomes.
The role of technology in streamlining deals
Generative artificial intelligence (AI) has emerged as a critical tool in M&A processes, with one in five global dealmakers using the technology for sourcing, screening, and due diligence in 2024. The Middle East has been quick to adopt these tools, leveraging AI to streamline transactions and enhance efficiency in a competitive market.
Looking ahead to 2025
Bain & Company plans to release its full 2025 M&A Report in February, providing an in-depth analysis of expected trends in the year ahead. The report will include insights from more than 300 M&A practitioners across key markets such as the United States, Europe, and Asia, along with a detailed examination of industry-specific developments.
As the global M&A market continues to evolve, the Middle East’s dynamic growth and strategic positioning are likely to play a pivotal role in shaping the future of dealmaking worldwide.