Despite all the turmoil, regional M&A activity was up fractionally last year: MENA closed mergers and acquisitions worth USD 86 bn in 2023, up 4% from the year before despite regional tension and global economic uncertainty, writes EY in its 2023 MENA M&A Insights update. Tech transactions led the pack, with 141 M&As recorded in 2023, the energy and resources sectors — including metals and mining, oil and gas, and chemicals — also saw “significant capital deployment” for the year.

Most came from the GCC: The Gulf nations closed 565 transactions, worth some USD 83.2 bn.

At the M&A helm: The region’s sovereign wealth funds drove activity — led by the Abu Dhabi Investment Authority (ADIA), UAE’s Mubadala, Saudi Arabia’s Public Investment Fund (PIF), and the Qatar Investment Authority — with a focus on “national development and investing in sectors of the future,” EY MENA strategy and transactions leader Brad Watson said.

Foreign transactions made up the lion's share of the year’s M&As: Cross border M&As made up 72% of the total value of M&As in 2023, with North America remaining the largest acquiring region by value — with transactions totaling USD 2.7 bn — and largest number of inbound MENA transactions — with 32. Meanwhile, domestic transactions made up 49% of the total volume of MENA M&As for the year.

Other highlights worth noting from the past year:

  • The UAE was investors’ preferred destination. Interest in the UAE was driven by “its business-friendly regulations and efficient legal framework.”
  • Outbound M&As secured USD 53.5 bn through 208 transactions.
  • The region’s largest M&A in 2023 was ADIA and Apollo Global Management’s USD 8.2 bn acquisition ofUnivar Solutions.
  • The second- and third-largest were PIF-owned Savvy Games’ USD 4.9 bn acquisition of US mobile games developer Scopely and Blackstone and ADIA’s USD 4.7 bn acquisition of software company Cvent Holding.

Looking ahead: “We expect M&A activity in MENA to remain robust in 2024 given continuing secular trends around energy transition and digitalization of everything,” Watson said.

Asian markets are a mixed bag this morning: The Nikkei and Kospi are handily in the green, but Chinese markets remain closed for the Lunar New Year holiday, so there’s nothing to report out of Hong Kong or Shanghai. Looking ahead: Futures suggest a weak open in both Europe and on Wall Street later today.

EGX30

28,495

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USD (CBE)

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Sell 30.96

USD at CIB

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Interest rates CBE

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THE CLOSING BELL-

The EGX30 rose 1.1% at yesterday’s close on turnover of EGP 4.9 bn. Foreign investors were net buyers. The index is up 14.5% YTD.

In the green: Oriental Weavers (+7.2%), Talaat Moustafa Group (+4.5%) and CIB (+4.5%).

In the red: Egypt Kuwait Holding (-3.7%), Alexandria Containers and Cargo Handling (-3.5%) and Edita (-3.3%).

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