Saudi Arabia emerged in the first quarter (Q1) of 2024 as the leader in mergers and acquisitions (M&A) in the Middle East’s chemicals sector, with $500 million worth of deals, according to recent data.
Financial markets platform Dealogic’s figures showed that the Kingdom’s total M&A deal volume during this period reached $955 million, with the chemicals sector accounting for 52.4 percent of the total. Saudi Arabia was the sole country in the region to exhibit activity in this sector.
Expectations of increased M&A activity
A report from management consulting firm Kearney earlier this month suggested that chemical executives are anticipating more M&As led by strategic investors, such as national oil companies. “Recent deals by major players like Aramco and ADNOC underscore the region’s commitment to leveraging M&A as a key growth lever, setting the stage for a dynamic and transformative period ahead,” said Jose Alberich, partner, Middle East and Africa at Kearney.
Other targeted sectors
The Dealogic figures also revealed that the professional services sector was the second targeted sector, with deals worth $160 million, accounting for a 16.8 percent share of the Kingdom’s total. Technology was close behind with $138 million in deal value, capturing a 14.5 percent share. Retail and insurance sectors represented 7 percent and 4.1 percent of the total, respectively.
Read more: Middle East sovereign funds: Powering M&A deals with $81.7 billion in 2023
Middle East M&A landscape
The data showed that during the first three months of the year, the Middle East’s targeted M&A volume reached $6.21 billion, with technology being the leading sector with 42 total deals worth $1.56 billion.
Global M&A slowdown
Dealogic’s report explained that global M&A activity experienced a significant decline during this period, with the number of transactions falling by 31 percent to 7,162, marking one of the quietest quarters for dealmakers in nearly two decades. Furthermore, the slowdown was largely attributed to high capital costs, with Switzerland being the only major economy to cut interest rates in 2024.
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