Key Takeaways
- • Middle Eastern sovereign wealth funds (SWFs) now hold roughly $4 trillion in assets under management across the six largest regional funds, with three of them based in Abu Dhabi, according to Skadden, Arps, Slate, Meagher & Flom LLP.
- • M&A aggregate deal value in the Middle East rose 25.3% year-on-year by Q3 2024, primarily driven by the UAE and Saudi Arabia.
- • Mubadala led all global investors in 2024 with $29.2 billion deployed across 52 deals, while four other GCC funds (ADIA, ADQ, PIF and QIA) ranked among the top 10 global dealmakers, investing a record $82 billion combined.
- • Gulf SWFs are shifting from passive minority investing toward controlling-stake transactions abroad, a trend Skadden and ION Analytics expect to support deal activity in 2025.
- • Liberalized foreign direct investment rules, golden visas and a streamlined ADGM licensing process are attracting inbound capital and financial firms to the UAE and Saudi Arabia.
Summary
A Skadden, Arps, Slate, Meagher & Flom LLP analysis argues that sovereign wealth funds have made the Middle East a new global center of wealth and investment. The six largest regional SWFs by assets under management are Abu Dhabi Developmental Holding Company (ADQ), Abu Dhabi Investment Authority (ADIA), Kuwait Investment Authority (KIA), Mubadala Investment Company, Public Investment Fund (PIF) of Saudi Arabia, and Qatar Investment Authority (QIA). Together they manage about $4 trillion, and in the first half of 2024 they accounted for over 54% of funds deployed by SWFs globally, the highest share since 2009. As of October 2024, Abu Dhabi, at $1.7 trillion, was the world's richest city by SWF-managed assets.
Regional deal activity has accelerated. Per the Skadden analysis, M&A aggregate deal value in the Middle East increased 25.3% by Q3 2024 versus the same period in 2023, mainly in the UAE and Saudi Arabia. Mubadala invested $29.2 billion across 52 deals in 2024, and ADIA, ADQ, PIF and QIA ranked among the top 10 global dealmakers. Notable outbound transactions include Mubadala's investment in Truist Insurance at a $15.5 billion valuation, Mubadala Capital's 42% stake in credit manager Silver Rock ($10 billion AUM), its $8.7 billion take-private of Canada's CI Financial, and a PIF-Ardian consortium's 37.6% stake in London Heathrow Airport for £3.26 billion ($4.13 billion).
The analysis notes that Gulf SWFs are increasingly taking controlling stakes rather than passive minority positions, a shift that ION Analytics expects to support deal activity in 2025. Financial centers are also expanding: Abu Dhabi asset-management AUM grew 226% over the past year as firms including PGIM, General Atlantic, BlackRock and Nuveen opened offices, and 1,271 new licenses were issued through the Abu Dhabi Global Market in the first half of 2024. Dubai and Abu Dhabi exchanges together exceeded $1 trillion in market capitalization by November 2024.
Inbound openness is also rising. GCC states are relaxing local partnership requirements and streamlining regulation, and Saudi Arabia's new investment law consolidates local and foreign firms under a single rulebook. Microsoft's $1.5 billion investment in UAE-based AI company G42 (April 2024) and Brookfield's deal to become lead investor in GEMS Education are cited as examples. Golden visas, revised property and inheritance rules, and low taxes are expected to attract skilled foreign talent. GCC FDI reached roughly $47 billion in 2023, with Saudi Arabia accounting for 62%, and Saudi Arabia targets $100 billion in annual FDI by 2030 from $29 billion in 2023.
Regional deal activity has accelerated. Per the Skadden analysis, M&A aggregate deal value in the Middle East increased 25.3% by Q3 2024 versus the same period in 2023, mainly in the UAE and Saudi Arabia. Mubadala invested $29.2 billion across 52 deals in 2024, and ADIA, ADQ, PIF and QIA ranked among the top 10 global dealmakers. Notable outbound transactions include Mubadala's investment in Truist Insurance at a $15.5 billion valuation, Mubadala Capital's 42% stake in credit manager Silver Rock ($10 billion AUM), its $8.7 billion take-private of Canada's CI Financial, and a PIF-Ardian consortium's 37.6% stake in London Heathrow Airport for £3.26 billion ($4.13 billion).
The analysis notes that Gulf SWFs are increasingly taking controlling stakes rather than passive minority positions, a shift that ION Analytics expects to support deal activity in 2025. Financial centers are also expanding: Abu Dhabi asset-management AUM grew 226% over the past year as firms including PGIM, General Atlantic, BlackRock and Nuveen opened offices, and 1,271 new licenses were issued through the Abu Dhabi Global Market in the first half of 2024. Dubai and Abu Dhabi exchanges together exceeded $1 trillion in market capitalization by November 2024.
Inbound openness is also rising. GCC states are relaxing local partnership requirements and streamlining regulation, and Saudi Arabia's new investment law consolidates local and foreign firms under a single rulebook. Microsoft's $1.5 billion investment in UAE-based AI company G42 (April 2024) and Brookfield's deal to become lead investor in GEMS Education are cited as examples. Golden visas, revised property and inheritance rules, and low taxes are expected to attract skilled foreign talent. GCC FDI reached roughly $47 billion in 2023, with Saudi Arabia accounting for 62%, and Saudi Arabia targets $100 billion in annual FDI by 2030 from $29 billion in 2023.
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