Merger and Acquisition (M&A) activity in the Middle East appears to be picking up, according to the latest data by mergermarket. For the first quarter 2012, the value of deals transacted was more than three times higher than the previous quarter – US$4 billion compared with US$1.68 billion in Q4 2011. Over the same period, the number of deals closed jumped from 21 to 35.
In 2011, the value of total deals stood at US$12.5 billion compared with US$14 billion in 2010.
“This is positive news for the M&A industry in the Middle East for it shows that a degree of investor confidence is returning to the Middle East market despite the Arab Spring and crisis in the Eurozone,” said Lucia Dore, head of GCC and Middle East, mergermarket.
But the data also shows that although the number of deals in the region transacted is creeping back to pre-financial crisis levels, actual deal size is getting smaller. While it took 35 deals to reach the US$4 billion figure this past quarter, back in Q3 2009 only 30 deals were required to achieve US$11.1 billion.
For the 13 months to the end of the first quarter this year, the most buoyant sector proved to be industrials and chemicals with $4.2bn worth of deals, constituting one-quarter of the total deal value of $16.5bn. However, this sector saw a turn of fortunes in the first quarter of the year with no deal activity at all.