UAE most targeted in Mena for M&A deals

The UAE was the most targeted nation for mergers & acquisitions in the Middle East and North Africa region as the value of deals in the first nine months reached $69.7 billion, 17 per cent less compared to the same 2021 period.

According to an investment banking analysis by Refinitiv, a London Stock Exchange Group business, despite the decline in value, the number of deals announced in the region increased 5.0 per cent from last year to the highest first nine-month total since 1980.

After the UAE, Saudi Arabia and Egypt were the most targeted nations for mergers & acquisitions in the region.

The UAE was also the most active debt issuer nation in the region during the first nine months of 2022, accounting for 61 per cent of total bond proceeds, followed by Saudi Arabia (23 per cent), Qatar (five per cent) and Bahrain (five per cent).

An estimated $1.1 billion worth of investment banking fees were generated in the region during the first nine months of 2022. Thirty-seven per cent of al fees were generated in the UAE during the first nine months of 2022, followed by Saudi Arabia (33 per cent) and Oman (9.0 per cent). JP Morgan earned the most investment banking fees in the region during the first nine months of 2022, a total of $84.3 million or an 8.0 per cent share of the total fee pool.

Deals involving a Mena target totalled $37 billion during the first nine months of 2022, down 38 per cent from the same period last year and a four-year low. The number of deals declined 1.0 per cent from last year but marked the second highest first nine-month deal count of all time. Inbound deals involving a non-Mena acquirer declined 73 per cent from last year’s all-time record to $10.0 billion.

Domestic deals increased 14 per cent in value to $28.0 billion, as the number of transactions exceeded 400 for the first time during any first nine-month period since our records began.

According to the report, Mena outbound M&A totalled $27.9 billion, up 70 per cent compared to the value recorded during the same period in 2021 and a 13-year high.

“The financial sector was most active, with deals targeting financial companies accounting for 22 per cent of Mena target M&A during the first nine months of 2022, followed by Industrials with 17 per cent.”

Equity and equity-related issuance in Mena totalled US$15.3 billion during the first nine months of 2022, the highest first nine-month total since 2008. Proceeds raised by companies in the region increased 166 per cent compared to the first nine months of 2021, while the number of issues increased 110 per cent.

Initial public offerings accounted for 86 per cent of activity during the first nine months of 2022, while follow-on issuance accounted for 14 per cent.

A total of 29 initial public offerings were recorded during the first nine months of 2022, 21 more than last year at this time and the highest level since 2008. They raised a combined $13.2 billion, setting a first nine-month record in the region. Dubai Electricity & Water Authority raised $6.1 billion in its stock market debut in April. The state utility’s initial public offering is the 3rd largest IPO globally so far this year and the second largest Mena IPO of all time. HSBC took first place in the Mena ECM underwriting league table during the first nine months of 2022 with an 18.5 per cent market share, followed by Saudi National Bank.

Debt issuance in Mena totalled $18.3 billion during the first nine months of 2022, down 80 per cent from the value recorded during the same period in 2021 and the lowest first nine-month total since 2011. The number of issues declined 68 per cent from last year at this time. In the third quarter, $2.0 billion was raised, down 74 per cent from the previous quarter and the lowest quarterly total in 13 years.

— issacjohn@khaleejtimes.com