The United Arab Emirates continued to dominate merger and acquisition (M&A) transactions in the Gulf Cooperation Council in the third quarter of the year, especially when it came to attracting overseas investors, according to a new report issued on Sunday, while Bahrain and Saudi Arabia saw their growth rates diverge in very different directions.

The UAE closed 14 M&A transactions in the GCC in Q3, representing nearly half of the 29 deals signed off in the region during the period, according to the latest research report by investment firm the Kuwait Financial Centre (Markaz).

Below is a summary of the key highlights from the Q3 GCC M&A Report:

• The 29 deals closed is the same compared to Q3 2017, but was down 26 percent quarter-on-quarter compared to the 39 deals closed in Q2 2018.

• Bahrain had three deals in Q3 (compared to none in Q3 2017), while Saudi Arabia reported just two deals, compared to eight in Q2 2018 and four in Q3 2017. Kuwait reported eight M&A transactions in the period, compared to 11 in Q2 2018 and seven in Q3 2018.

• Oman rose from one deal in Q2 2017 and Q3 2018 to two deals in the latest quarter, while Qatar again saw no deals in the recent quarter (compared to one in Q2 2017).

• In terms of sectors, financial and information technology was by far the most active, accounting for 48 percent of transactions, while healthcare, media and utilities each accounted for 3 percent of all deals.

• GCC-based firms accounted for 69 percent of closed deals, but the appetite differed among the six countries. Kuwaiti investors preferred deals within their home country, Saudis generally looked within the wider GCC, while Emirati, Qatari and Bahraini investors tended to look overseas outside the GCC.

• Looking ahead, eleven deals were announced as being in the pipeline in Q3, the report said, a 35 percent decrease compared to the number of transactions announced in Q2. In line with the overall trend, the UAE dominated with five deals on the table, followed by Qatar and Kuwait with two each, one each in Bahrain and Saudi Arabia and none in Oman.

• The biggest deal announced during the quarter was United Energy Group’s plan to acquire 100 percent of Kuwait Energy, in a deal valued at $491 million. The biggest deal closed in the quarter was India’s Shree Cement’s $305 million deal to acquire 93 percent of Union Cement in the UAE.

• When it came to foreign investors targeting deals in the GCC during the quarter, seven transactions were closed during Q3, all of which took place in the UAE.

Click here to read the full Q3 M&A report

Further reading:
• MENA investment banking fees down for the third year in a row
• Middle East M&A deals hit eight year high - report
• Uptick in M&A in Mideast to continue in current year
• M&A deal values grow 59% YoY in H1, jump 62% in Middle East
• MENA investment activity grows in H1 on record deals - MAGNiTT
• Middle East mergers gain momentum through privatisation and regulatory reforms 
• Capital markets off to a flying start in 2018

(Writing by Shane McGinley; Editing by Michael Fahy)
(shane.mcginley@refinitiv.com)

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