Gulf Investment Banks Eye Bigger M&A Fees as Sovereign Funds Drive Complex Cross‑Border Deals in 2026

Middle East investment banks are preparing for a busier fee year in 2026 as GCC sovereign wealth funds and state‑owned enterprises (SOEs) step up complex cross‑border M&A, even as global deal activity remains uneven. A new industry outlook from Ken Research and recent law‑firm briefings point to rising volumes in financial services, AI infrastructure and energy transition, with the UAE and Saudi Arabia anchoring regional advisory demand.

The Middle East’s M&A deal volumes grew 19 percent in the first half of 2025, outperforming global markets, and total deal value surged 260 percent year‑on‑year to $53 billion in the first nine months of the year, according to Boston Consulting Group. That rebound followed a slow start when rising rates and geopolitical tensions depressed valuations and delayed transactions, but the recovery underscored the region’s growing role as both buyer and seller of strategic assets.

GCC sovereign funds are at the centre of this shift. In August 2025, Mubadala Capital completed its $8.7 billion take‑private of Canada’s CI Financial, while also agreeing to a $10 billion investment alliance with TWG Global, signalling Abu Dhabi’s intent to be a long‑term consolidator in global wealth and asset management. Another Abu Dhabi‑based group, Lunate, agreed to acquire a minority stake in UK hedge fund Brevan Howard and commit substantial capital to a new investment platform in Abu Dhabi Global Market (ADGM), blending inbound and outbound flows.​

In AI and data infrastructure, global investors are partnering directly with Gulf tech firms. Blackstone agreed to invest around $3 billion with Saudi AI company Humain to build data centres in the kingdom, while OpenAI struck a deal with Abu Dhabi’s G42, backed by Mubadala, to develop a 5‑gigawatt data‑centre cluster in the UAE. These transactions are emblematic of a new wave of deals that combine energy, digital and infrastructure themes, generating multi‑jurisdictional mandates for regional and international investment banks.

Ken Research notes that the UAE remains the region’s financial hub thanks to its banking infrastructure, free zones and established advisory ecosystem, but Saudi Arabia’s Vision 2030 is rapidly shifting capital‑markets gravity toward Riyadh. As Saudi regulators open Tadawul’s Main Market to all foreign investors from February and push for more listings, local and global investment banks see opportunities in equity capital markets, privatisations and restructuring‑linked M&A.

Egypt is drawing renewed interest as it advances IMF‑linked reforms and prepares to restart its privatisation programme, which could include minority stakes in state‑owned banks and industrial champions. Gulf and Asian investors have already taken positions in Egyptian infrastructure, ports and financial assets; advisers expect 2026 to bring more bilateral and club deals rather than headline‑grabbing megamergers.

A PwC survey shows 72 percent of Middle East CEOs plan a major acquisition over the next three years, underscoring sustained board‑level appetite for inorganic growth and portfolio rotation. At the 2026 BAFT MENA Bank‑to‑Bank Forum in Dubai this week, senior bankers and corporate treasurers are set to discuss cross‑border funding, trade finance and risk‑sharing structures that often accompany M&A in energy, logistics and digital infrastructure.

Dealmakers caution that valuations and regulatory scrutiny are becoming more complex. Competition authorities in the EU, UK and increasingly Gulf markets are paying closer attention to transactions that bundle data, infrastructure and critical technologies. Political sensitivities around AI, semiconductors and critical minerals also mean that some deals involving Japanese, Korean or US assets may take longer to clear.

For regional investment banks, 2026 is less about chasing volume and more about moving up the value chain—winning mandates on cross‑border, multi‑sector deals where SWFs and SOEs want deep sector expertise and global syndication capabilities. Firms that can combine local relationships, cross‑border legal and regulatory knowledge, and structuring skills spanning sukuk, equity and private capital are poised to capture a growing share of fee pools as Gulf capital reshapes assets from Toronto to Tokyo.