Mergers and acquisitions in the Middle East have seen a slowdown in 2022 as corporate and financial investors turned cautious amid rising interest rates and increasing economic anxiety. While M&A activity remained resilient in the first few months of 2022, it lost some momentum as macroeconomic conditions started to deteriorate throughout the year, the agencies reported.
Multiple economic and financial headwinds have complicated dealmaking globally in 2022. A key deterrent has been the tightening of credit conditions, with banks pulling back the financing of leveraged buyouts amid rising interest rates and a broader risk-off environment. Leveraged loans issued to fund private equity (PE) acquisitions have largely dried up across Europe and the Middle East.
In the Middle East, however, the number of deals decreased only slightly from 366 in the nine months to September 2021 to 343 in the nine months to September 2022. Companies headquartered in the UAE, Saudi Arabia, and Israel were the most targeted by buyers, accounting for 20.7 per cent, 9 per cent and 54.2 per cent of the total deals in the region, respectively.