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M&A deals poised to bounce back in the Middle East

Geopolitical risks, terms agreement, and valuation disparities between buyers and sellers are the primary obstacles to completing M&A deals in the region

M&A deals poised to bounce back in the Middle East
[Source photo: Anvita Gupta/Fast Company Middle East]

After a lackluster 2023, the Middle East’s merger and acquisition (M&A) scene is gearing up for a potential comeback. M&A activity in the MENA is expected to surge in 2024, according to a new survey.

In the first half of 2023, there were 318 deals worth a combined $43.8 billion in the region, a 14% drop in volume compared to the previous year. However, a sense of optimism has returned, fueled by a recent survey of 200 senior M&A figures by Norton Rose Fulbright and Mergermarket.

About 37% of respondents now predict a “somewhat” increase in activity for 2024, with 12% even expecting a “significant” rise. The survey also identified the key players driving this potential resurgence. International strategic acquirers topped the list (53%), followed by domestic private equity firms (35%).

Identified as the foremost challenge in finalizing M&A deals in the region, geopolitical risk takes the top spot. Followed by agreement on terms and the task of reconciling disparities in valuations between potential buyers and sellers.

“We are still seeing uncertainty in the financing markets, but I am hopeful that 2024 will be a better market,” Raj Karia, Norton Rose Fulbright’s head of corporate, M&A and securities in Europe, Middle East and Asia, said in the report.

Region-specific trends are also emerging. The $100-$250 million deal range is projected to be most common, followed by $251-$500 million acquisitions. This aligns with the expectation that consolidation within specific sectors, like the recent merger of OSN+ and Anghami, will continue to be a major driver of activity.

“Given the rapid growth of both the industry and the region, it’s highly likely that we’ll see more mergers and acquisitions,” Elia Mssawir, CEO of UAE-based music label GXR Records, said at the time.

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