M&A in the UAE and Gulf: An active market, but the way deals are assessed is changing

From our position at CGI, a Dubai-based consultancy working across compliance support, M&A, corporate finance and financial collation, we are seeing a more practical and evidence-driven market. Buyers are still interested in growth, but they now spend much more time examining structure, governance, financial records, regulatory position and whether a business is genuinely ready for due diligence.

This is especially relevant in the SME and mid-market space. Many businesses in the UAE and wider Gulf have grown quickly through strong relationships, referrals and opportunity-led expansion. That growth can create real value, but it does not always mean the business is transaction-ready.

In many cases, the business itself is attractive. It may have good revenue, a strong client base, a valuable licence, recurring income or a clear market opportunity. The challenge often appears when a buyer starts asking for the detail. Are the management accounts reliable? Is revenue split clearly between recurring and one-off income? Do the filed accounts support the valuation? Are contracts, licences, employment records, supplier agreements and compliance policies properly organised?

These points may seem administrative, but they have a direct impact on deal confidence. A buyer does not only buy profit. A buyer buys certainty. If the information is incomplete, inconsistent or difficult to verify, valuation and deal certainty are affected.

This does not mean the business is weak. Often, it simply means the company has grown operationally faster than it has grown structurally. That is common in fast-moving markets such as the UAE, where businesses can scale quickly before their internal systems, reporting and governance have fully caught up.

One of the most important trends we are seeing is the UAE’s focus on building capability in-country and then taking that capability global. Historically, Gulf capital has often been associated with overseas investment, global real estate, listed markets, infrastructure and strategic foreign assets. That still happens, but capital is becoming more selective.

In our view, much of the current focus is on businesses, platforms and capabilities that strengthen the UAE’s domestic ecosystem first, and then scale internationally from a UAE base. International investment is still attractive, but increasingly there needs to be a clear connection back to the UAE. Can the project, technology, licence, expertise or management capability be brought into the country? Can it support local capability, create regional employment, build a UAE-headquartered platform or add strategic value to the UAE’s wider ambitions?

This is also changing how international business owners view the UAE. We are seeing more owners of overseas businesses making the UAE their personal and commercial base, particularly where they are considering a future sale, partial exit or capital event. For many, the reasons are practical: lifestyle, access to capital, regional growth opportunities, connectivity and the ability to operate from a respected international hub. Personal tax planning and residency considerations can also be relevant when owners are preparing in advance of a transaction.

That said, the UAE should not be viewed only through a tax lens. The more important point is that owners are increasingly using the UAE as a strategic base before a transaction takes place. They may relocate personally, establish regional headquarters, build local substance, access investors, or use the UAE as a platform for expansion into the GCC, Africa, India and wider emerging markets.

For M&A, this matters. Location, substance and structure can all affect how a transaction is viewed. An owner who starts preparing early has more flexibility than one who waits until a buyer is already at the table. The right structure, reporting and governance can make a business easier to assess, easier to acquire and more attractive to investors.

We are also seeing the rise of the “UAE platform” acquisition. International buyers are looking for UAE-based companies that can support expansion across the GCC, Middle East, Africa and South Asia. At the same time, UAE-based investors are looking at international opportunities where value can be brought into, or managed from, the UAE. This may involve acquiring technology, bringing specialist talent into the region, establishing local service capability or using the UAE as the commercial headquarters for wider growth.

Qatar and Bahrain also have important roles in the regional picture. Qatar has significant financial resources and a clear diversification agenda, with interest in sectors such as financial services, technology, logistics, sports, infrastructure and education. Bahrain remains a well-established financial services and fintech market, with a practical regulatory environment and a long history in banking, insurance and professional services.

Across the Gulf, buyers are becoming more disciplined. They are looking closely at quality of earnings, customer concentration, working capital, management depth, regulatory exposure and whether the business can operate independently from its founder. This is particularly important in founder-led businesses. If most relationships, decisions or processes sit with one individual, the buyer will usually see greater risk.

This is where preparation makes a real difference. At CGI, we help businesses collate and review the financial, commercial, compliance and operational information needed to support M&A, investment, or strategic review. This can include organising management information, reviewing corporate and regulatory structures, identifying gaps before due diligence begins and helping owners understand what a buyer or investor is likely to focus on.

Compliance is also becoming more central to M&A. This is especially relevant in sectors such as financial services, professional services, recruitment, education, healthcare, fintech, ESG, carbon reporting and corporate services, where licences, approvals, client onboarding and governance standards matter. In these sectors, a transaction is not only commercial. It may also involve change of control approvals, key person approvals, client file reviews, policy updates or remediation of historic issues.

This is why we believe compliance should be built into the transaction process from the beginning. A business that is financially prepared but not compliance-ready is not truly ready for sale. Equally, a business with policies in place but poor financial reporting will still struggle to support its valuation.

For many owners, the best first step is not going straight to market. It is carrying out a readiness review. This helps the business understand what a buyer would see if due diligence started tomorrow. It also gives the owner time to fix issues before they affect valuation, timing or negotiating position.

The Gulf M&A market remains full of opportunity, but it is becoming more professional, more selective and more evidence-driven. Buyers want substance. Sellers need preparation. 

That is where the real work begins.

By Mike Foster-Dalporto

Partner at CGI

CGI is an international corporate finance consultancy based in Dubai and a business partner to CDI Global.