The mergers and acquisitions deals announced in the Mena region dropped by 15 per cent in value to $18.5 billion in the first half compared to $21.7 billion last year, according to Ernst & Young (E&Y).

In its latest M&A update, E&Y, one of the world's leading professional service organizations, said the second quarter had seen a 85 per cent jump in the deal value which surged to $12 billion from $6.5 billion in the previous quarter.

However, in terms of total number of deals, the second quarter witnessed a 12 per cent decline from 76 deals to 67 in the first quarter, the report stated.

The countries that experienced a large degree of domestic activity in terms of number of transactions in second quarter were Kuwait (7 deals), followed by Jordan (5 deals) and Egypt, Saudi Arabia, and the UAE (3 deals each).

Egypt ranked highest in the region in terms of deal value, comprising 28 per cent of the total disclosed deal value of $624 million. Oman closely followed at 23 per cent with $525 million deals and the UAE at 16 per cent with $372 million.

“Despite the fact that fewer deals took place in second quarter in the Mena region, Jordan was still one of the highest performing countries,” said Samar Obaid, Transactions Advisory Services partner at Ernst & Young, Jordan.

“Overall, and despite drops in the number of deals, the value of deals increased comparatively. In terms of transactions, however, all deal activity in Jordan was domestic whereas regionally, domestic and inbound deals decreased because regional investors are increasingly investing overseas,” he added.

Domestic transactions by volume, comprising 45 per cent of total announced deals in the second quarter, outnumbered inbound and outbound deal activity, as was also the case last year, the E&Y said in the report.

The outbound deals held the greatest value among total announced deals, comprising $9.1 billion, or 76 per cent of total announced deal value in the second quarter.

Comparatively, during the same period last year the domestic deal activity saw the highest deal value, averaging at approximately 47 per cent of total announced deal values.

The sectors that attracted the most inbound deal activity in the second quarter were diversified industrial products (3 deals) and consumer products (2 deals), the report said.

The sector with the greatest inbound deal activity in terms of deal value was mining, worth $464 million.

The other two sectors with the highest deal value in inbound deal transactions were diversified industrial products (worth $57.5 million) and banking and capital markets (worth $30 million), it added.

The E&Y said the report summarises and tracks M&A activity in the Mena market limited to Algeria, Bahrain, Egypt, Iran, Iraq, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, Palestinian Territories, Qatar,  Saudi Arabia, Sudan, Syria, Tunisia, UAE and Yemen.-TradeArabia News Service