GCC M&A Report – Q3 2020

Executive Summary

Transactions decreased by 23% compared to Q3 2019

Throughout Q3 2020, the GCC market observed a total of 23 closed M&A transactions, a substantial decrease relative to the same period in the previous year however, this number remained stable relative to the previous quarter. At approximately 44%, the UAE accounted for the majority of the transactions that closed throughout the quarter followed by Kuwait and Saudi Arabia, who accounted for 26% and 22%, respectively. The remaining transactions that closed involved Bahraini and Qatari companies whereas the Omani market recorded zero closed transactions throughout the quarter. It is worth noting that the Kuwaiti market witnessed the greatest level of growth quarter-over-quarter (QoQ) as it witnessed twice as many transactions (closed) as it did in the previous quarter.

Moreover, these transactions spanned across multiple sectors which was also observed in Q3 2020. With that being said, the sectors that witnessed the greatest level of activity throughout the quarter were the Financials, Industrials and Information Technology sectors. Collectively, these sectors accounted for more than 48% of the total number of closed transactions. It is worth noting that the Financials and Industrials sectors were also among the sectors that witnessed the greatest level of activity in Q2 2020 as well. In addition, there was a notably weaker level of interest from foreign buyers when compared to the previous quarter as well as the previous year. Overall, foreign acquirers closed three transactions throughout the quarter, which is 40% lower relative to Q2 2020 and 67% lower relative to Q3 2019.

Furthermore, GCC acquirers actively acquired both regional and international companies, whereas in the past quarter, they primarily invested in the regional market. With that being said, they closed a slightly lower number of transactions cross-border relative to Q2 2020. Throughout Q3 2020, GCC acquirers closed a total of nine transactions that involved international companies, which is 23% lower in comparison to the number of cross-border transactions that closed in the previous quarter. Moreover, Saudi and UAE buyers each accounted for 33% of these transactions, followed by Bahraini, Kuwaiti and Qatari acquirers, who accounted for the remainder of the transactions. On the other hand, Omani acquirers didn’t close any transaction cross border.

Click "Download for free", to access the full report. For any queries, kindly contact research@markaz.com