Mena M&A deals rocket 238%

dubai — The value of merger and acquisition deals targeting the Middle East jumped 238.1 per cent year-to-date to $26.6 billion in 2016 compared to the same period in 2015.

The region witnessed 55 deals worth $26.6 billion announced so far this year compared to 54 deals worth $7.9 billion in 2015, according to data provided by Mergermarket.

The latest data has been released by the global provider of M&A intelligence ahead of the Saudi Arabia M&A and Capital Markets Forum, to be held in Riyadh on November 16.

Deal value was highly influenced by the largest transaction in the region so far this year — National Bank of Abu Dhabi’s (NBAD) $14.8 billion acquisition of UAEbased First Gulf Bank (FGB) — accounting for 55.6 per cent of the Middle East’s total M&A value, Technology Energy, mining & utilities Consuner Trasport Financial services Other and pushing the financial services sector to the top of the industry rankings (six deals totalling $15.5 billion).

The deal will come into effect in first quarter 2017 through a share swap with FGB shareholders receiving 1.254 NBAD shares for each FGB share they hold. Even without taking this deal into account, Middle Eastern M&A activity (54 deals, $11.8 billion) would still have registered a 49.5 per cent value increase year-on-year.

Deal-making in energy, mining and utilities experienced a clear drop in activity from 2015, with the sector’s share of the M&A market falling from 60.1 per cent to just 5.4 per cent ($4.7 billion to $1.4 billion) year-to-date. Meanwhile, the transport and consumer sectors saw increased deal values compared to the previous year.

This trend was driven by German-based Hapag-Lloyd’s acquisition of United Arab Shipping Company for $5.4 billion, which helped boost the transport sector’s share to 20.6 per cent ($5.5 billion). Nine deals in the consumer sector contributed to a total value of $3.5 billion, up from just $175 million in 2015.

— issacjohn@khaleejtimes.com