Mubasher: Two of the GCC states, Saudi Arabia and the UAE, have acquired 90% of the merger and acquisition (M&A) deals executed by private companies, investment firms, and advisors during the first six months of 2019, according to a recent report by Lumina Capital Advisers Limited.
The Lumina Private Company Index (LPCI) indicated that the most active sectors, including industrials, healthcare, and consumer, with intra-GCC deals accounted for 63% of the M&A activity during the first half of 2019.
Furthermore, a subdued private equity activity has been registered in the M&A deals with little to no capital raising activity at fund level in the post Abraaj era during H1-19.
“However, secondaries transactions continue to pique international private equity interest, both at a fund and portfolio level, which are expected to drive most of the private equity action in the region,” according to Lumina, a specialist corporate finance advisory firm specialising in private company M&A throughout the GCC.
Endorsed by government-led infrastructure and social reforms, Saudi Arabia is expected to advance the M&A transactions during the second half of 2019, based on elevated levels of deals preparations being seen from Lumina’s clients, managing partner at Lumina George Traub commented.
“According to respondents to our ‘State of M&A’ survey, the main reasons driving private company M&A are succession planning (46%), access to capital (34%) and diversification of markets (38%),” George Traub further added.
