Gulf M&A market shows resilience as deal value rises and activity becomes more selective
M&A activity across the Gulf Cooperation Council (GCC) delivered a robust performance in the first half of 2026, with deal value rising even as transaction volumes declined, according to a new market review by Grant Thornton.
The overall market for mergers and acquisitions (M&A) in the region has remained positive amid continued geopolitical instability and shocks to the economy. The Grant Thornton report found that while volume has decreased since last year, significant capital was still committed to a smaller number of large, strategic transactions.
The GCC recorded 192 completed transactions in the first six months of the year, down from 234 during the same period in 2025, a drop of nearly 18%. Despite this slowdown, disclosed transaction values across the region reached $65.1 billion, up 12% compared with a year earlier.
The UAE remained the dominant dealmaking market in the region, accounting for 68% of all GCC transactions and more than 80% of total disclosed deal value.
While the first quarter of this year saw volume fall by around 30%, June was the only month in the positive, with 42 deals compared with 38 last year in the same month. This decrease is mainly linked to a more selective investment environment, according to the report.
“H1 2026 demonstrated that valuation resilience in the UAE is increasingly being underpinned by fundamentals rather than sentiment,” said Neha Julka, partner with Grant Thornton. “While investors have become more cautious in their capital allocation decisions, confidence in businesses with strong market positions, visible cash flow generation and scalable growth platforms remains robust.”
Why fewer deals moved more money
Grant Thornton’s researchers attribute this shift to a market increasingly driven by strategic intent rather than broad-based capital deployment. Investors, the report noted, have grown more cautious in how they allocate money, but confidence remains strong for businesses with clear market positions, steady cash flow, and room to scale.
This investment shift has widened the gap between premium assets, which continue to draw strong competition and pricing, and the rest of the market, where deal activity has cooled.
Majority acquisitions made up 64% of total deal volume during the period, while minority investments accounted for roughly 21%. Buyers also intensified scrutiny during due diligence, focusing more heavily on earnings sustainability, cash conversion, and exposure to geopolitical risk before committing to a transaction.
A record aviation deal leads the pack
Among the largest transactions of the first half of this year was the agreement from Dubai Aerospace Enterprise (DAE) to acquire all of Macquarie AirFinance for approximately $9 billion. This huge deal, announced in February and confirmed upon completion in July, stands as the company’s largest acquisition to date. It expands DAE’s aircraft leasing platform and strengthens its position in the global aviation market by adding scale, a more diversified customer base, and broader reach into new territories.
Sovereign capital also played a major role in shaping deal value during the period. For example, the Qatar Investment Authority took part in a $7.4 billion transaction involving asset manager Janus Henderson, one of several landmark deals that pushed regional deal value higher in the second quarter.
Sector themes and what comes next
Beyond these headline transactions, sector activity reflected some clear national priorities. Food and beverage and consumer deals were buoyed by food security concerns and supply chain resilience, while healthcare mergers continued at a steady pace amid population growth and expanding demand for private care.
Infrastructure, logistics, and technology platforms also drew strong interest, with regional players expanding their footprints through control-led acquisitions rather than passive minority stakes.
The report also pointed to the growing influence of serial acquirers in shaping the UAE market. Firms like AD Ports Group, International Holding Company, and L’IMAD used repeat, controlling-stake transactions throughout the period to expand platforms and diversify earnings, often moving into new regions or sectors entirely.
Looking toward the second half of 2026, Grant Thornton expects deal activity to remain selective but resilient, supported by low inflation, ample liquidity, and continued non-oil economic growth in the UAE. Non-oil foreign trade hit a record $528 billion in the first half of the year, up 13% from the prior year, while the country’s banking sector assets climbed to roughly $1.5 trillion in AED terms.
The firm expects large strategic and sovereign-backed transactions to keep driving deal value even if the total volume stays below prior-year levels, with technology, healthcare, infrastructure, and logistics likely to remain the sectors buyers are most interested in through the rest of the year.
“The UAE deal environment has remained positive but also selective and measured,” said Salmaan Khawaja, partner and head of deals at Grant Thornton.
“Naturally, the region has witnessed geopolitical volatility this year. However, as we know, there is no shortage of capital in the region. This capital is being deployed in strategic assets. For the remainder of this year, we expect quality assets to continue attracting strong interest but valuation discipline, deal risk mitigation and a clear value-creation case will determine which transactions reach completion.”
