Mergers and acquisitions (M&A) across the Middle East and North Africa (MENA) reached $46 billion in the first quarter of 2025, marking a 66% jump from the $27.6 billion recorded in Q1 2024. This data comes from the latest EY MENA M&A Insights report, highlighting the region’s strong economic momentum.
Not only did deal value rise, but volume also improved. A total of 225 deals were recorded, up from 172 during the same period last year—an increase of 31%.
Cross-Border Transactions Fuel M&A Growth
Much of this activity was driven by cross-border deals. These accounted for 52% of total deal volume (117 transactions) and an even more striking 81% of total deal value, amounting to $37.3 billion. Compared to previous years, Q1 2025 marked the highest cross-border performance in both volume and value. This trend suggests that more companies are now seeking opportunities beyond their domestic markets.
According to Brad Watson, MENA EY-Parthenon Leader, “In 2024 we saw a steady flow of M&A deals and the MENA region continues to exhibit a robust influx of M&A transactions in 2025. This is supported by regulatory reforms, policy shifts, and a favourable macroeconomic outlook, including easing interest rates and improved investor sentiment.”
He added that domestic M&A also contributed significantly, making up 48% of deal volume. This aligns with the IMF’s projected 3.6% GDP growth for MENA in 2025.
UAE Remains the Top Investment Destination
The UAE maintained its lead in regional M&A activity, recording 63 deals valued at $20.3 billion. Kuwait followed, securing $2.3 billion in deal proceeds, driven by significant investments in the industrial products and utilities sectors.
In terms of domestic deals, the technology sector emerged as the frontrunner. It contributed 37% of total domestic deal value and 27% of volume. One of the most notable transactions was a $2.2 billion acquisition by Group 42, an Abu Dhabi-based AI and cloud company. The firm acquired a 40% stake in Khazna Data Centres, bolstering its position in digital infrastructure.
Strong regional integration was also evident. Deals between the UAE, Saudi Arabia, and Kuwait made up 83% of domestic deal value and 56% of deal volume, especially in technology, industrials, and real estate.
Foreign and Outbound Deals Expand Diversification Strategy
The first quarter also saw a sharp rise in inbound investment. Deal volume grew by 21%, while value soared to $17.6 billion, a significant jump from $2.5 billion a year earlier. The UAE attracted 53% of all inbound deal volume and a staggering 99% of deal value. Austria led as the top inbound investor by value, largely due to a key deal in the chemicals sector.
Outbound M&A deals increased as well. Volume rose by 63%, and total outbound deal value reached $19.7 billion, accounting for 43% of the region’s total. The UAE and Saudi Arabia dominated outbound activity, comprising 77% of total volume and 94% of value. Though chemicals and oil & gas led in value, the majority of outbound deal volume focused on technology, diversified industrial products, and professional services.
A major outbound transaction was the $6.3 billion acquisition of Nova Chemicals in Canada by ADNOC and Austria’s OMV AG. Each party holds a 46.94% stake in the newly formed Borouge International Group.
The UK was the top outbound destination by volume, logging 13 M&A transactions from MENA-based entities. Together, Canada and Peru accounted for 50% of outbound deal value, reinforcing the region’s push into high-growth sectors abroad.
Outlook Remains Positive for 2025
Anil Menon, MENA EY-Parthenon Head of M&A and Equity Capital Markets, remains optimistic. “The MENA deal markets remained resilient despite lack of clarity on two fronts: the impact of monetary policy on cost of capital and the ongoing tariff and trade discussions,” he said.
“The MENA deal book for the remainder of 2025 is promising,” Menon added. “We expect to see increased activity in consumer, technology, and energy sectors. With AI set to drive fundamental shifts in value creation, significant capital is likely to flow into the tech space.”
