The Middle East and North Africa (MENA) region recorded 225 merger and acquisition (M&A) deals totalling $46.0 billion in the first quarter of 2025, marking a 31% increase in deal volume and a 66% rise in value compared to the same period in 2024, according to EY’s latest MENA M&A Insights report.
Cross-border transactions were the primary driver, accounting for 117 deals valued at $37.3 billion, which represented 52% of the total deal volume and 81% of the total deal value. This marks the highest cross-border activity in both volume and value for any first quarter in the past five years as companies pursued growth and diversification beyond domestic markets.
The UAE remained the top target country, with 63 deals totalling $20.3 billion. Kuwait followed, with deal proceeds reaching $2.3 billion, driven by significant transactions in the diversified industrial products and power & utilities sectors.
Domestic M&A activity also saw growth, with 108 deals contributing $8.7 billion in value, up from $1.69 billion in Q1 2024. The technology sector led domestic activity, accounting for 37% of total domestic deal value and 27% of deal volume. A notable transaction was Abu Dhabi-based Group 42’s $2.2 billion acquisition of a 40% stake in Khazna Data Centres.
Intraregional deals involving the UAE, Kuwait, and Saudi Arabia accounted for 83% of the total domestic deal value and 56% of the deal volume, with significant activity in the technology, industrial, and real estate sectors.
Inbound M&A activity increased, with deal volume rising by 21% and value reaching $17.6 billion, compared to $2.5 billion in Q1 2024. The UAE attracted the majority of inbound investment, capturing 53% of deal volume and 99% of deal value. Austria was the top investor country, contributing 94% of total inbound deal value, largely due to a major transaction in the chemicals sector.
Outbound M&A activity reflected the region’s diversification efforts, with deal volume increasing by 63% and total value reaching $19.7 billion. The UAE and Saudi Arabia led outbound investments, accounting for 77% of deal volume and 94% of deal value. While chemicals and oil & gas dominated outbound deal value, technology, diversified industrial products, and professional services were the primary sectors by deal volume.
Canada attracted the highest outbound deal value from MENA investors at $6.4 billion, while the UK was the leading destination in terms of deal volume, with 13 transactions. A significant transaction involved ADNOC and Austria’s OMV AG agreeing to acquire Canada’s Nova Chemicals for $6.3 billion, each holding a 46.94% stake in the newly formed Borouge International Group.
Sovereign wealth funds, such as ADIA, PIF, and Mubadala, along with other government-related entities, continued to be key drivers of M&A activity in Q1 2025, aligning with national economic strategies and diversification goals.
