Global private equity firms flock to the Middle East

Global private equity and venture capital firms are progressively focusing on the Middle East and North Africa (MENA) region, as rapid technology adoption and the transition away from fossil fuel dependence create promising investment opportunities. Despite global economic slowdown, the Middle East market remains vibrant. Investors have been setting up shop in the Middle East, drawn to both deep wells of investment capital and a surprisingly resilient PE industry. This acceleration largely stems from the rest of the world being capital constrained. As of early 2024, Dubai’s DIFC has reported a 23% rise in active registered companies, underscoring heightened investor confidence.

At the beginning of 2023, French private equity firm Ardian established an office in Abu Dhabi following a partnership with Mubadala. In July, Paris-listed Tikehau Capital also set up offices in the capital. This was followed by US asset manager Blue Owl, which, in September, launched a joint venture with Abu Dhabi-based Lunate and opened its own offices in Abu Dhabi. In November 2023, General Atlantic expanded its presence by opening offices in both the UAE and Saudi Arabia, while HIG Capital, which already has a strong presence in Europe, opened a new office in Dubai in January.

With the income generated by oil production, the region has amassed significant financial wealth to invest in various financial sectors, such as asset management and investment services. Family offices, a significant force in the region’s investment landscape, heavily utilise alternative assets like private equity.