The Middle East M&A market continued to demonstrate resilience in the first half of 2026, with deal volume increasing despite geopolitical tensions, market volatility and broader economic uncertainty. While many regions experienced slower transaction activity, the Middle East recorded growth in deal volume, reflecting strong investor confidence and the continued impact of economic diversification initiatives across the region.
M&A transaction volume increased from 57 deals in H2 2025 to 67 deals in H1 2026, while aggregate deal value remained broadly stable at approximately USD 6.8 billion. This indicates that activity was supported by a wider range of mid-market transactions rather than a handful of large deals, highlighting the growing depth and maturity of the regional market.
Private equity and sovereign capital continue to drive growth
Private equity activity strengthened further during the period, with deal volume increasing from 12 to 15 transactions and aggregate deal value approaching USD 1 billion. Investors continued to focus on scalable businesses, digital platforms and high-growth opportunities across the region.
At the same time, GCC Sovereign Wealth Funds maintained their influential role in regional investment activity. Collectively, GCC sovereign wealth funds invested approximately USD 14.8 billion across 42 Middle East transactions during H1 2026, while global sovereign wealth fund deployment reached USD 53.9 billion. Mubadala Investment Company remained the world's most active sovereign wealth fund during the period.
Sector trends point to continued diversification
Technology, Media and Telecommunications (TMT) remained the leading sector by completed deal volume, followed by Industrials & Chemicals and Business Services. These sectors reflect growing investor interest in digital transformation, industrial development and operational efficiency.
Looking ahead, the strongest deal pipeline opportunities are expected to emerge in Energy, Mining & Utilities and Industrials & Chemicals, signalling a further expansion of diversification-driven investment themes across the region.
Saudi Arabia spotlight: transformation continues to attract strategic investment
Saudi Arabia remains one of the most important M&A markets in the region, supported by ongoing economic transformation initiatives and continued investment across priority sectors. According to the report, activity in the Kingdom is particularly concentrated in Industrials & Chemicals, Healthcare and Leisure, reflecting investment trends aligned with long-term diversification objectives.
One of the report's highlighted transactions was the acquisition of Dr Mohammad bin Rashed Al-Faqih & Partners Co by Dr Soliman Abdul Kader Fakeeh Hospital Company, valued at approximately USD 425 million. The transaction reflects continued investor confidence in Saudi Arabia's healthcare sector and the growing importance of healthcare assets within the Kingdom's broader transformation agenda.
Saudi Arabia also remained the region's leading IPO market during the period, demonstrating the strength and resilience of its capital markets despite a slowdown in overall regional IPO activity.
Looking ahead
As H2 2026 progresses, investors are expected to remain selective, prioritising businesses with strong fundamentals, scalable operating models and strategic relevance. Economic diversification programmes, sovereign capital deployment and continued private-sector participation are expected to support dealmaking across the Middle East.
Explore the full report
Discover the latest Middle East M&A trends, sector forecasts and investment insights in the full BDO Horizons 2026 Issue 2 report and learn how regional opportunities are evolving across key markets and industries.