MENA M&A Reaches $46.7Bn in H1 As Q2 Deal Value Doubles

RIYADH: The Middle East and North Africa region completed 390 mergers and acquisitions deals valued at $46.7 billion in the first half of 2026, underscoring the resilience of the market amid geopolitical conflicts, an analysis showed. 

Deal value climbed to $25 billion in the second quarter, more than doubling from $12.2 billion a year earlier, according to EY’s latest MENA M&A report.

The increase came even though overall activity slowed compared to the first half of 2025, when 434 deals worth $58.8 billion were recorded, as the ongoing US-Iran conflict weighed on investor sentiment. 

A separate PwC study published in July found that M&A activity in the Middle East totaled an estimated 272 transactions in the six months to the end of June, down about 8 percent from a year earlier, with Saudi Arabia recording 74 transactions during the period. 

Commenting on his firm’s latest report, Brad Watson, MENA EY-Parthenon leader, said: “The first half of 2026 has shown the strength and resilience of MENA’s M&A market, with strategic investors continuing to pursue long-term growth opportunities despite a more measured global investment environment.”

He added: “Strong domestic capital deployment, active sovereign investors and the region’s continued focus on economic diversification have helped sustain deal activity, while improving momentum toward the end of the second quarter reflects growing confidence in the region’s long-term investment outlook.” 

May and June alone accounted for 61 percent of second-quarter deal volume and 79 percent of deal value, signaling improving market confidence. Large transactions valued at more than $500 million contributed nearly three-quarters of total deal value between March and June.

Domestic demand leads

Domestic and outbound transactions remained the primary drivers of activity during the first half. 

Domestic deal value between March and June reached $16 billion, more than four times the level recorded in the same period a year earlier.

 Activity was supported by large strategic transactions in real estate, power and utilities, and technology. 

Government-related entities continued to play a leading role, reinforcing investment in infrastructure and national transformation programs. 

Outbound investment remained resilient, with 119 deals worth $25.5 billion completed in the first half. 

The UAE and Saudi Arabia remained the region’s most active outbound investors, targeting opportunities in technology, transportation, financial services, and energy-related sectors. 

Notable transactions included Dubai Aerospace Enterprise’s $7 billion acquisition of Macquarie AirFinance and Saudi Electronic Gaming Holding Co.’s $6 billion acquisition of Shanghai Moonton Technology. 

Anil Menon, MENA EY-Parthenon head of M&A and equity capital markets, said the first half of 2026 reflected a disciplined investment environment, with investors continuing to prioritize transactions that support long-term strategic objectives. 

“While geopolitical developments have influenced the pace of inbound activity, domestic and outbound investment has remained resilient, supported by strong corporate balance sheets, sovereign capital and continued investment across priority sectors,” Menon said.

He added: “As market conditions continue to stabilize, we expect strategic, high-quality assets to remain at the center of M&A activity across the region.”

Tech draws capital

While inbound investment moderated amid geopolitical uncertainty, technology accounted for the largest share of inbound deal value between March and June. 

Investor interest focused on AI-driven solutions, enterprise digitalization, software platforms, and technology-enabled business services. The UAE continued to lead as MENA’s preferred destination for inbound investment. 

Sovereign wealth funds and government-related entities remained central to regional dealmaking. Institutions including the Abu Dhabi Investment Authority, Saudi Arabia’s Public Investment Fund, and Mubadala continued to deploy capital across strategic sectors in line with long-term economic diversification agendas.