Middle East and North Africa region witnesses 225 mergers and acquisitions transactions totaling $46 billion in the first quarter.

The MENA region has seen a significant boost in M&A deals in the first quarter of 2025, with 225 recorded transactions totaling $46 billion. This marks a notable increase from the 172 deals worth $27.6 billion in the same period in 2024, representing a 31% rise in deal volume and a 66% surge in total deal value.

Cross-border M&A deals have been a major driving force behind the increased activity in the MENA region, accounting for 52% of the total deal volume with 117 deals and 81% of the total deal value at $37.3 billion. The heightened focus on cross-border transactions is indicative of companies’ efforts to expand and diversify beyond their domestic markets.

Brad Watson, MENA EY-Parthenon Leader, attributes this growth to regulatory reforms, policy changes, and a positive macroeconomic outlook characterized by favorable interest rates and growing investor confidence. In addition, the increase in domestic M&A activity, which accounted for 48% of the total deal volume in Q1 2025, aligns with the IMF’s projection of a 3.6% GDP growth in the MENA region this year.

Major players in the MENA M&A landscape include the United Arab Emirates (UAE), which remained the top target country with 63 deals totaling $20.3 billion in the first quarter of 2025. Kuwait followed closely with $2.3 billion in deal proceeds, driven by significant transactions in the Diversified Industrial Products and Power & Utilities sectors.

On the outbound front, Canada attracted the highest deal value from MENA investors at $6.4 billion, with the USA continuing to be a preferred target destination in terms of deal volume. Sovereign Wealth Funds (SWFs) such as ADIA, PIF, and Mubadala, as well as other government-related entities (GREs), played a crucial role in driving M&A activity in the region, aligning with national economic strategies and diversification goals.

The technology sector emerged as a key player in domestic M&A activity in Q1 2025, contributing 37% of the total domestic deal value and 27% of the total domestic deal volume. The largest domestic deal during this period was a $2.2 billion acquisition where Group 42, an Abu Dhabi-based AI and cloud computing firm, acquired a 40% stake in Khazna Data Centres, a digital infrastructure provider.

Anil Menon, MENA EY-Parthenon Head of M&A and Equity Capital Markets Leader, notes the resilience of the MENA deal markets despite uncertainties surrounding monetary policy and trade discussions. Looking ahead, he anticipates increased activity in consumer, technology, and energy sectors, with significant capital allocation expected in technology as AI continues to drive fundamental value shifts.