Famous M&A Middle East mergers and alliances

Famous M&A Middle East mergers and alliances

Blog Article

Strategic alliances and acquisitions are effective strategies for multinational companies aiming to expand their operations into the Arab Gulf.

In recently published study that examines the connection between economic policy uncertainty and mergers and acquisitions in GCC markets, the authors discovered that Arab Gulf firms are more inclined to make acquisitions during periods of high economic policy uncertainty, which contradicts the conduct of Western firms. For instance, big Arab financial institutions secured acquisitions throughout the 2008 crises. Furthermore, the study suggests that state-owned enterprises are not as likely than non-SOEs to produce takeovers during periods of high economic policy uncertainty. The the findings suggest that SOEs are far more prudent regarding acquisitions in comparison to their non-SOE counterparts. The SOE's risk-averse approach, according to this paper, emanates from the imperative to protect national interest and minimising prospective financial uncertainty. Moreover, acquisitions during periods of high economic policy uncertainty are related to a rise in investors' wealth for acquirers, and this wealth effect is more pronounced for SOEs. Certainly, this wealth effect highlights the potential for SOEs just like the people led by Naser Bustami and Nadhmi Al-Nasr to exploit opportunities in similar times by capturing undervalued target businesses.

GCC governments actively promote mergers and acquisitions through incentives such as for instance taxation breaks and regulatory approval as a way to consolidate industries and develop local businesses to become capable of compete on a international scale, as would Amin Nasser likely let you know. The need for economic diversification and market expansion drives a lot of the M&A transactions in the GCC. GCC countries are working earnestly to bring in FDI by creating a favourable ecosystem and increasing the ease of doing business for foreign investors. This plan is not only directed to attract international investors since they will add to economic growth but, more most importantly, to facilitate M&A deals, which in turn will play a significant role in enabling GCC-based companies to get access to international markets and transfer technology and expertise.

Strategic mergers and acquisitions have emerged as a way to overcome hurdles worldwide businesses encounter in Arab Gulf countries and emerging markets. Businesses planning to enter and expand their reach into the GCC countries face various difficulties, such as for example cultural distinctions, unfamiliar regulatory frameworks, and market competition. But, when they acquire regional companies or merge with regional enterprises, they gain instant use of local knowledge and study their local partners. One of the more prominent cases of successful acquisitions in GCC markets is when a giant international e-commerce corporation acquired a regionally leading e-commerce platform, which the giant e-commerce company recognised as a strong contender. Nevertheless, the acquisition not only removed regional competition but in addition provided valuable local insights, a customer base, as well as an already established convenient infrastructure. Furthermore, another notable instance could be the purchase of a Arab super application, specifically a ridesharing company, by an international ride-hailing services provider. The international firm gained a well-established manufacturer having a big user base and substantial understanding of the local transportation market and customer choices through the acquisition.