M&A deal values grow 59% YoY in H1, jump 62% in Middle East

The total value of international merger and acquisition (M&A) transactions jumped 59% year-on-year in the first six months of 2018, whereas their volume tumbled 12%, a new report by Baker McKenzie showed.

The sum of M&A deals was $2.5 trillion during H1-18, compared to the year-ago period, the report added.

Year-on-year, the value of US deals levelled up 51% to $419 billion, while China’s inbound M&A transactions hit $33 billion and outbound ones reached $75.9 billion.

“In the United Kingdom, cross-border and domestic deal values spiked by a staggering 130% and 96% respectively, as the country explores investments abroad in the wake of Brexit developments,” Baker McKenzie said.

In the Middle East region, the value of M&A deals surged 62% to $25.4 billion in H1-18 from $15.7 billion in the corresponding period of 2017, while their volume remained unchanged.

The UAE alone made up 65% of inbound and outbound M&A deals in the Middle East during the first six months of 2018.

“The UAE was the most attractive target country to overseas investors in H1-18, with a total of 34 inbound deals valued at $6.6 billion,” the report showed.

The energy and power sector was seen as “the most attractive target sector” for inbound investment in the Middle East both in terms of value and volume and value in H1-18. The sector witness 15 deals worth a combined value of $7.4 billion during the period.

"We continue to see healthy investor appetite and deployment of capital into the Middle East, particularly in the UAE with its strong underlying economic fundamentals and openness to foreign investment," said Will Seivewright, corporate/M&A partner at UAE-based Baker McKenzie Habib Al Mulla.