M&A in MENA
The surge in mergers and acquisitions (M&A) activity in the Mena region is a sign of the growing maturity of startups. The increase in the number of exits indicates that investors are confident enough to exit their investments, and the increase in international acquisitions shows that regional companies are not only looking for growth opportunities in local markets.
This trend is also driven by the desire of large companies to acquire innovative technologies and products from smaller startups. This suggests that large companies are increasingly turning to M&A as a way to quickly acquire new capabilities without having to build them internally.
The rise in M&A deals also signals an increased availability of capital to fund startups in the region. In 2021, venture capital investment in Mena startups reached $1 billion for the first time ever, with more than half coming from outside investors such as Softbank Vision Fund and Tiger Global Management. This influx of capital has allowed entrepreneurs to scale their businesses faster than ever before, making them attractive targets for acquisition by large companies or other investors seeking quick returns on their investments.
Finally, it is important to note that this trend is not just limited to technology sectors such as e-commerce or fintech; there have also been several notable exits from traditional industries such as healthcare and agriculture in the past year. This suggests that M&A activity will remain high across all industries in 2022 and beyond, as more investors turn their attention to these markets in search of potential returns on their investments.
Overall, it appears that M&A activity will remain active through 2022, thanks to continued investor confidence in Mena startups coupled with increased access to capital from both domestic and international sources. As more money pours into the region’s startup ecosystem than ever before, we can expect even more exciting events during this year and beyond!
March 1, 2023