M&A activity across the GCC has been buoyant in 2025 and, as the pace and complexity of deal activity continues to accelerate, the implications for legal practitioners and deal makers alike are significant. Below, I outline some of the key drivers, trends and observations shaping the current M&A landscape in the GCC.
AI is increasingly shaping the region’s investment priorities. The UAE and Saudi Arabia were early movers in embracing AI; for example, the UAE appointed the world’s first Minister of AI in October 2017. Furthermore, following Trump’s visit to the UAE in May 2025, an agreement was reached to build the largest AI Campus outside the US, which would also allow the UAE access to NVIDIA’s most advanced AI chips.
This forward-looking approach is now paying off. The rise of AI is expected to generate greater demand for data infrastructure (data centres in particular) and AI-focused investment is expected to accelerate, all of which will keep the UAE and KSA ahead of their peers globally.
Consistent government spending continues to support market momentum, particularly in social programmes such as healthcare, disability support, and pensions. These initiatives are part of a broader diversification strategy that aims to reduce reliance on oil revenues and stimulate private sector growth. This, in turn, is generating a wider array of investment opportunities across industries.
The regional private equity landscape, which was historically dominated by a handful of influential players, is being transformed by new fund and asset managers setting up and scaling up their businesses, primarily in the ADGM. This list includes BlackRock, Morgan Stanley, PGIM, Nuveen, Marshall Wace and most recently Davidson Kempner, and subsequently we have observed that the ADGM’s assets under management (AUM) surged by as much as 245% in 2024. In short, the broader mix of PE firms entering the fray is increasing competition, which is putting pressure on pricing but also expanding the diversity of deals.
Crucially, PE sponsors are now also no longer relying solely on government-linked entities and, armed with fresh mandates and dry powder, they are finding opportunities and value in privately-owned businesses with scalable models and attractive fundamentals.
In addition, the growing maturity of capital markets, especially IPO markets in KSA, is also providing more flexible exit opportunities. Moreover, the era of M&A activity being defined by a few landmark deals (such as the Aramco and ADNOC mega-deals) is evolving into a more balanced ecosystem that supports mid-market, high-impact transactions. Recent examples include:
These deals reflect a broader, more sustainable deal pipeline that allows capital deployers more flexibility when deciding when to enter and exit, which is in turn, opening up new pools of capital and increasing mid-market deal flow.
Historically, the corporate lending landscape in the region was dominated by traditional bank lenders, which provided the lion’s share of financings. However, there is a growing appetite for private credit in the region, driven by a need for alternative funding solutions, particularly in the UAE and Saudi Arabia.
The growth of the private capital market is providing a new and flexible source of capital, offering more flexible financing options and enabling strategic acquisitions and growth. Ultimately, this gives investors more options, meaning private credit is emerging as a core engine driving deal-making.
As the GCC is a relatively new market for private credit, each successful transaction closing is paving the way for new creditor investor entrants to have the necessary confidence to enter, originate and participate in the market. These new entrants are considering an array of private credit investment strategies, including senior secured loans, mezzanine facilities (as well as bridge debt), venture debt, distressed debt, special situations lending and real estate debt.
In a topical example of how private credit interest is growing in the region, Oaktree Capital Management recently announced that they have provided a debt financing commitment to Arzan Investment Management to pursue GCC hospitality opportunities.
What sets the GCC apart is the unique role played by SWFs and how they are gathering soft power globally. The major regional SWFs are not purely looking to export capital, but aim to use investments, their ability to deploy capital and M&A as a broader tool of influence.
Unlike traditional private equity, SWFs in the GCC are increasingly focused on long-term value creation with an emphasis on building domestic capabilities and making investments that align with national interests. Outbound investments, for instance, are being structured (through joint ventures and co-investments) to bring expertise and knowledge back to the region. There is also a focus on direct local investment and investing in the local start-up ecosystem. This adds a distinct dimension to the regional M&A market that blends global ambition with local impact.
More broadly, GCC SWFs are increasing their soft power globally by increasingly investing in assets which have an impact on the everyday lives of people all over the world. In particular, sport has risen on the agenda in recent times, and, for example, the PIF has taken a majority stake in Newcastle United in addition to investing billions of dollars in esports and the gaming industry, with its most significant recent investment being a $55 billion deal to acquire Electronic Arts (EA).
As the M&A market in the GCC continues to evolve and mature, it is clear that the GCC will garner increasing global attention as the region positions itself as the epicentre of innovation, growth, and strategic capital deployment.
The buoyancy of the market has led major global law firms to invest heavily in the region in order to capitalise on the flurry of activity. Firstly, we have seen a number of new entrants with the most notable examples being the launches of Skadden and Paul Hastings both in Abu Dhabi. Secondly, we have also seen firms with an existing presence look to expand and, for example, Akin Gump, CMS, Simmons, BCLP, Trowers and Reed Smith have all opened offices in Riyadh in recent months to further grow their regional footprint.
SSQ has been involved in the majority of the headline, market-defining M&A moves at both the partner and associate level across the GCC for over a decade. If you are interested in hearing more about the market or would like a discreet view of the opportunities available, please contact me or my team to set up a discussion.
