The United Arab Emirates (UAE) tops all other nations in investment quantities in the Middle East and North Africa (MENA) area last year, according to report by a non-profit institute promoting private equity and venture capital sector in the region.
The MENA Private Equity Association said in its latest report that the UAE accounts for 35 percent of investment volumes in the area in 2015, followed by Saudi and Lebanon, both of which accounted for 14 percent.
The report said that the UAE recorded a "significant increase" in the number of venture capital deals. Major transactions included 60 million dollars fund raised by Dubai-based Careem (Arabic for "noble"), the app based car service and considered the Arab answer to its rival from the United States, global chauffeur service Uber.
In 2015, disclosed transactions rose by over 100, reaching 175 compared to 2014. Last year also marked the most active year in alternative investments in MENA since 2008 when the global financial crisis kicked in, said the report.
However, the value of these disclosed investments went down marginally to 1.49 billion dollars from 1.57 billion in 2014, said the report.
Salmaan Jaffery, Chief Business Development Officer at DIFC, said "new financial technologies opening up interesting opportunities for fund-raising and emerging markets with untapped wealth opening up fresh investment avenues, private equity is continuing to change in scope and focus to meet the changing demands of investors and policy makers alike."
Helmut Schuehsler, CEO of specialist Private Equity firm TVM Capital Healthcare Partners, and member of the MENA Private Equity Association's Steering Committee, said "Although recent emerging market volatility may make fund-raising challenging, it also creates attractive investment opportunities, especially in defensive sectors such as health care that benefits from solid long-term fundamentals."
Deal trends seen last year are expected to continue in 2016, with fund managers continuing to indicate a strong preference for consumer driven, defensive sectors and is likely to provide further opportunities to deploy capital effectively.
According to Dubai-based MENA private equity firm Al Masah Capital, the UAE is expected to remain a fertile ground for company deals and over-the-counter financing as Dubai will host the six-month global even Expo 2020.