According to the EY MENA M&A Insights 2025 report, the MENA region recorded a robust 26% rise in merger and acquisition (M&A) activity with 884 deals, compared to 701 in 2024. The total deal value reached US$106.1b, indicating a 15% increase on the previous year’s US$92.3b. The GCC region accounted for the majority of deals at 685, valued at US$102.1b.
This expansion was largely fueled by enabling regulations, ongoing economic diversification initiatives and disciplined deal-making. Cross-border M&As dominated the region, making up 54% of the volume and 61% of the value.
Sovereign wealth funds (SWFs), such as Abu Dhabi Investment Authority (ADIA) and Mubadala from the United Arab Emirates (UAE) as well as the Public Investment Fund (PIF) from the Kingdom of Saudi Arabia (KSA), remained among the primary catalysts of M&A activity in MENA.
Brad Watson, EY-Parthenon MENA Leader, says:
“The MENA M&A market remained resilient in 2025, with deal volume as well as value rising significantly. Cross-border transactions were the main driver of this upward curve, highlighting the increasing appetite of companies for international expansion and diversification. Governments continued to invest steadily, supported by robust economic growth, low public debt, SWF backing and broader economic diversification initiatives. Rising foreign direct investment (FDI) added further momentum.”
The region’s three largest deals of 2025 were concentrated in the UAE, led by the acquisition of a 64% stake in Borouge by the Austrian oil giant OMV and its subsidiary Borealis for US$16.5b. This was followed by the acquisition of an 84.76% stake in Modon Holding by L’IMAD Holding Company, owned by the Abu Dhabi Government, for US$13.8b. The third-largest deal was the acquisition of a 42.2% stake in 2PointZero by Multiply Group, an Abu Dhabi-based investment holding company, for US$7.7b.
Cross-border deals saw notable increases in both volume and value
Inbound deal volume increased by 37% to 223 deals, while deal value surged to US$25.4b, more than double compared to last year’s US$11.4b, reflecting sustained confidence in the region’s evolving economic landscape. Austria emerged as the top investor country, accounting for 65% of total inbound deal value with three major transactions in the chemical sector.
Meanwhile, outbound deals grew in volume by 29% year on year (y-o-y) to 256 deals and reached a combined value of US$39.2b, representing 37% of the total. Government-related entities (GREs) remained major contributors to MENA dealmaking in 2025, making up 64% of overall outbound deal value. Canada attracted the highest outbound deal value from MENA investors at US$7.1b, while the United States (US) retained its position as the preferred target destination in terms of deal volume.
North America, Europe and Asia together accounted for 44% and 39% of cross-border deals by volume and value respectively.
In terms of sectors, technology and diversified industrial products were the leading contributors to overall deal volume at 38%.
Domestic deal activity witnesses robust growth
Domestic transactions played an important role in driving overall deal momentum in 2025. Domestic M&A transactions contributed 46% of the total deal volume at 405, compared to 339 deals in 2024. The combined disclosed value of domestic deals increased to US$41.6b from US$24.4b in the previous year.
Domestic M&A activity in the region was led by the technology and consumer products sectors that together contributed 38% of the total domestic deal volume. In terms of value, the real estate (including hospitality and leisure) and asset management sectors accounted for a combined 55% of the total, reflecting diversified investments across key domestic industries.
Anil Menon, EY-Parthenon MENA Head of M&A and Equity Capital Markets Leader, says:
“2025 was a remarkable show of MENA M&A market resilience. The significant increase in M&A market activity was inspite of regional political unrest, significant global trade policy uncertainties and a once-in-a-generation tech transformation led by AI. These are times of significant shift in fundamental value of assets and we expect M&A to be deployed surgically by corporates and SWFs to drive enduring competitive advantage.”
UAE and KSA experience the majority of MENA investments
As target nations, the UAE and KSA together captured 59% of MENA investments, mainly in technology and professional firms and services. In addition, they contributed 66% of the region’s total deal activity as investors, with a focus on technology and diversified industrial products.
On an overall basis, Egypt and Kuwait made it among the region’s top five target countries as well as bidder countries last year, while Oman and Qatar also made an appearance on the lists.
With 131 deals, the UAE led domestic activity as the most attractive hub for investors due to its favorable business environment, stable regulations and ongoing economic reforms. The country also remained the preferred destination for foreign investors, supported by expanding trade volumes, resilient domestic demand and sustained economic diversification efforts. The technology, professional firms and services as well as diversified industrial products sectors recorded the highest number of deals in 2025. The strong momentum positioned the UAE as one of the key FDI hubs, contributing 49% of total inbound deal volume and 92% of inbound deal value across MENA.
Banking and capital markets highlight MENA investors’ appetite for international expansion
The banking and capital markets sector accounted for 14% of MENA’s total outbound deal value in 2025. The region’s banks and financial institutions are actively investing in Indian banks and non-banking financial companies (NBFCs), supported by India’s strong economic growth, expanding credit demand, resilient financial system and its rapidly growing base of digital users. Notable transactions include Emirates NBD’s US$4.4b deal with RBL Bank, IHC’s US$1.1b investment in Sammaan Capital and ADIA’s investment in IDFC FIRST Bank.
