Gulf dealmaking slowdown deepens as Iran war, U.S. scrutiny weigh on M&A
After a wave of large Gulf transactions in 2025, merger activity across the UAE, Saudi Arabia, Qatar and Kuwait is losing momentum as investors turn more cautious. The pullback reflects disruption from the Iran war and the prospect that political shifts in the U.S. could bring tougher scrutiny of megadeals.
Highlights
- Gulf M&A value dropped to about $5 billion in Q3 2023, sharply down from $69 billion a year earlier, marking the lowest level since 2022.
- Fourth quarter Gulf deal values are down more than 90% year-on-year, signaling a deepening slowdown after 2025’s $55 billion Electronic Arts Inc. acquisition.
- Geopolitical instability and increased U.S. scrutiny on large acquisitions are deterring Gulf companies from executing large cross-border M&A transactions.
Quarterly M&A values fall sharply
As reported by Bloomberg, the value of mergers and acquisitions involving Gulf companies slumped to about $5 billion in the third quarter, the lowest level since 2022 and down from $69 billion a year earlier.The decline is intensifying in the fourth quarter, with deal values down more than 90% from the same period a year earlier so far, based on data compiled by Bloomberg. The figures point to a sharp reversal from the region's dealmaking surge in 2025, which had been highlighted by the $55 billion purchase of Electronic Arts Inc.
Regional caution clouds big-ticket transactions
The weaker deal flow suggests that geopolitical instability is disrupting investment planning across the Gulf at a time when governments and major companies have been seeking to expand their regional and international footprint.At the same time, changing political dynamics in the U.S. are raising the risk that very large acquisitions could face closer examination, adding another obstacle for buyers pursuing cross-border megadeals.
In our earlier report on the IMF’s warning about escalating Middle East conflict risks, we noted that renewed disruptions to energy production, shipping routes, and trade flows could push parts of the region into a contraction in 2026 before an uneven rebound in 2027. The piece also stressed that regional buffers are limited, prompting policymakers to prioritize price stability and fiscal resilience as shocks and volatility persist across affected economies.
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