Now in its fourth edition, the Clyde & Co Middle East Deal Study is a one of a kind report. By analysing data from the deals Clyde & Co has advised on in the region it gives an unparalleled insight into attitudes to risk and the current market practice for M&A and JVs. Since inception, 329 transactions have been reviewed, with an aggregate deal value of USD 17.55 billion.
Today's shifting – and at times contradictory – dynamics are shaping deal-making in the Middle East. Sentiment is cautious but positive and appetite for the right deals at the right price is strong. In such a context, market data and expert insight are a vital tool for anyone executing M&A or JV transactions in the region.
Despite relatively tough market conditions, both deal volumes and aggregate values have increased since our previous study in 2017, suggesting there is good reason to be optimistic about the outlook ahead.
Our aim in this report is to use our proprietary deal data and our expert insight to help regional and international businesses and their in-house counsel, as well as advisers and intermediaries, navigate market practice so that they can adequately allocate risk and capitalise on the opportunities that exist.
Should you require any further information on the issues raised in this report, please do not hesitate to contact us.
1. Healthcare gets pulses racing
Healthcare tops our table of deals-by-volume as population growth and rapid technological change spur innovation. Meanwhile oil & gas market turbulence in recent years has created opportunities for strategic acquisitions and collaboration in energy.
2. M&A on the rise as JVs decline
Growing confidence in the legal environment and moves to open up foreign ownership may explain why the proportion of JVs versus M&A deals is down. JVs were also more likely to be true partnerships rather than "structures of convenience".
3. M&A: a buyer-friendly, but cautious market
The market now appears to be becoming more favourable for buyers with more extensive warranties and walk away rights for buyers. Caution remains, however, particularly in relation to pricing structures with completion accounts gaining ground over locked box.
4. Value and volume up
Both aggregate deal value (up 57% to USD 3.15 billion) and deal volume (up 14% to 89 deals) have increased since our 2017 report.
5. Challenges persist in closing deals
Regulatory hurdles remain high. While important, these can often delay deals and create extra layers of complexity. This can affect the ability to close deals quickly and make business asset transfers complex.
6. Improved dispute resolution options
Overall, deal makers now have a growing number of reliable dispute resolution options. DIFC-LCIA arbitration is now the go-to forum to hear disputes. English law (and increasingly DIFC law) is the dominant governing law.
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