RIYADH — Saudi Arabia has emerged as the top private equity (PE) market in the Middle East and North Africa (MENA) region during the first half of 2025, capturing 45% of all PE transactions, according to the latest MENA Private Equity Report by MAGNiTT.
The Kingdom secured 13 deals, marking an 8% year-on-year increase, surpassing the UAE, which recorded 12 transactions — a 25% decline compared to the same period last year.
Together, Saudi Arabia and the UAE accounted for 86% of the region’s total private equity activity, reaffirming their dominance in the MENA investment landscape.
Regional Slowdown, Strategic Shift Toward Larger Deals
Despite Saudi Arabia’s rise, the overall MENA private equity market contracted, with deal volume dropping 38% year on year. This marks the third consecutive half-year decline in transaction activity.
However, disclosed deal value declined by only 11%, reaching $2.88 billion, indicating a shift toward larger, high-conviction investments rather than a withdrawal from the market.
“The MENA region’s PE recalibration is being led by scale-ready SMEs and high-conviction strategies — not exit,” said Farah El-Nahlawi, Research Department Manager at MAGNiTT. “The growing dominance of $100M+ deals signals a maturing landscape ready to absorb larger capital pools.”
Saudi Arabia’s Broader Investment Momentum
The surge in PE activity aligns with Saudi Arabia’s strong performance in venture capital (VC). According to a separate MAGNiTT report, the Kingdom led MENA VC investments in early 2025, raising $860 million, a 116% increase year on year.
The report noted 114 VC deals in H1 2025 — up 31% from the same period in 2024 — highlighting the Kingdom’s rising appeal as a capital destination for both PE and VC investors, fueled by sovereign support and increasing foreign investor interest.
Investor Profiles: Domestic Strength in KSA, Global Appetite in UAE
In Saudi Arabia, 12 out of 13 private equity deals involved local investors, reflecting robust domestic investment momentum.
Meanwhile, two-thirds of the UAE’s deals (8 out of 12) were led by international investors, reaffirming the Emirates’ role as a gateway for cross-border capital in the region.
Big Deals Dominate as Smaller Transactions Decline
Key trends in the first half of 2025 include a shift toward bigger deals:
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$500M–$1B deals: 29% of total transactions — highest in five years
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$1B+ deals: 14% — also a five-year high
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Deals under $50M: Dropped to just 14%, the lowest on record
On a value basis:
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$500M–$1B range: 42% of disclosed capital
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$1B+ segment: Declined from 45% in 2024 to 36% in 2025 H1
These patterns reflect global private equity trends. According to S&P Global, international PE deal value rose 18.7% year on year, even though deal volume decreased 6%, signaling a worldwide pivot toward fewer but more significant transactions.
“Despite global macro uncertainty, the GCC — particularly Saudi Arabia and the UAE — continues to demonstrate structural strength and investor confidence,” said El-Nahlawi. “With sovereign support, maturing SMEs, and pro-investor regulations, the region is poised to anchor future PE growth.”
Rest of MENA: Minimal Activity, Egypt Sees Sharpest Drop
Outside of the top two markets:
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Egypt, Jordan, Morocco, and Qatar each logged one PE deal, collectively accounting for the remaining 14% of MENA activity.
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Egypt experienced the steepest decline, with PE transactions plunging 89% year on year.
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