According to PwC Middle East’s recent TransAct mid-year report, mergers and acquisitions (M&A) in the Middle East saw a significant increase of 19 percent in the first half of 2025, totaling 271 transactions. This rise stands in contrast to a 9 percent drop in M&A activity observed globally.
The document, titled “Middle East M&A Resilient Amid Global Slowdown Driven by Sovereign Capital, Reforms, and Growth Sectors”, attributes this growth to sovereign wealth funds, domestic investors, and corporations that are engaging in mid-market deals. These transactions are not only more straightforward to finance and quicker to execute, but they also align with national initiatives emphasizing localization, enhanced digital capabilities, and economic diversification.
Romil Radia, leader of Deals Markets at PwC Middle East, stated, “The Middle East has displayed notable resilience and ambition in the first half of 2025, as evidenced by the growth in deal-making, which contrasts sharply with the decline in global M&A volumes.” He further mentioned that “the pivot towards mid-market, high-impact transactions indicates a concentrated effort on strategic assets that are easier to finance and are in line with national priorities such as localization, economic diversification, and the development of digital and green infrastructure.”
Key Sectors Fueling M&A Activity
The technology, energy transition, and healthcare sectors remain pivotal to the region’s M&A landscape. Noteworthy transactions include G42’s acquisition of a 40 percent stake in Khazna Data Centers for $2.2 billion, along with Saudi Arabia’s ambitious $100 billion Project Transcendence AI initiative, which emphasizes advancements in digital infrastructure and cutting-edge technologies.
The report also noted increased sovereign investment in green hydrogen, renewable energy, and sustainable transport. Moreover, the consolidation efforts in specialized healthcare aim to improve access and bolster localization.
PwC anticipates that domestic and intra-regional deals will continue to dominate M&A activities, with mid-sized transactions offering the most feasible path for growth in transformative sectors.