RIYADH: Saudi Arabia emerged as the most active private equity market in the Middle East and North Africa during the first half of 2025, accounting for 45 percent of all recorded transactions.
According to MAGNiTT’s MENA Private Equity Report, the Kingdom posted 13 deals, an 8 percent increase year on year, outpacing the UAE, which recorded 12 transactions, representing a 25 percent annual decline.
Combined, the two markets comprised 86 percent of total regional PE deal activity, highlighting their growing dominance in the MENA investment landscape.
Overall, the region continued to see a contraction in transaction volumes, with total activity dropping by 38 percent year on year to account for just 29 percent, marking the third consecutive half-year decline.
Disclosed deal value dropped only 11 percent from the first half of the year 2024 to $2.88 billion, as capital shifted toward larger, high-conviction investments.
“The MENA region’s PE recalibration is being led by scale-ready SMEs (small and medium-sized enterprises) and high-conviction strategies, not withdrawal,” said Farah El-Nahlawi, research department manager at MAGNiTT, adding: “The growing dominance of $100M+ deals signals a maturing landscape ready to absorb larger pools of capital.”
The Kingdom’s PE growth aligns with its venture capital growth. According to a separate report by MAGNiTT, Saudi Arabia led MENA VE activity in early 2025, raising $860 million — a 116 percent year-on-year increase — driven by sovereign backing and rising foreign investor interest.
The report recorded 114 VC deals in the first half of the year, up 31 percent from the same period in 2024, highlighting the broader momentum across the nation’s investment ecosystem and its growing appeal as a capital destination for both private equity and venture capital.
Investor activity varied notably among key markets. In Saudi Arabia, 12 out of 13 transactions involved local investors, highlighting strong domestic momentum.
In contrast, two-thirds of the UAE’s deals — eight out of 12 — were led by international investors, reaffirming the UAE’s role as a regional gateway for cross-border capital.
The concentration of capital into larger deals was a defining trend. Transactions in the $500 million to $1 billion range rose to 29 percent of the total in the first half of 2025, while $1 billion-plus deals accounted for 14 percent — both the highest shares in five years.
At the same time, smaller deals under $50 million dropped to just 14 percent, the lowest level on record.
On a value basis, transactions in the $500 million to $1 billion bracket made up 42 percent of disclosed capital, overtaking the $1 billion-plus segment, which declined from 45 percent in 2024 to 36 percent in the first half of 2025.
This evolution aligns with broader global investment patterns. According to S&P Global, international PE deal value rose 18.7 percent year on year in the first half of 2025 despite a 6 percent decrease in volume, suggesting an industry-wide pivot toward fewer but more substantial transactions.
“Despite global macro uncertainty, the GCC, particularly Saudi Arabia and the UAE, continues to demonstrate structural strength and investor confidence,” El Nahlawi said, adding: “Backed by sovereign support, maturing SMEs, and a favorable regulatory environment, the region is poised to anchor future PE activity.”
Beyond the Kingdom and the UAE, Egypt, Jordan, Morocco, and Qatar each recorded a single transaction, jointly accounting for the remaining 14 percent of regional activity. Egypt experienced the sharpest drop, with dealings down 89 percent year on year.
