The UAE attracts over 30 billion dollars in annual FDI. For institutional investors and multinational corporations, properly structuring an M&A deal here is not a detail—it is the difference between creating and destroying value. The mergers and acquisitions market in the United Arab Emirates underwent a transformation between 2021 and 2025, evolving from a peripheral market into a primary destination for mid-to-large-scale cross-border transactions.
According to data published by the UAE Ministry of Economy, foreign direct investment (FDI) in the UAE reached 31.4 billion dollars in 2024, the highest level ever recorded, and projections for 2026 indicate a further growth in the range of 12-15%.
This growth reflects the convergence of multiple structural factors:
- The reform of the foreign ownership system (which in 2021 eliminated the requirement to have a 51% local partner in nearly all commercial and industrial sectors);
- The introduction of a modern and predictable legal system for resolving commercial disputes (with the expansion of the DIFC Court and the strengthening of commercial arbitration);
- The geographic positioning of the UAE as a natural hub between Europe, Asia, and Africa—a positioning that has acquired unprecedented strategic value in the context of the geopolitical fragmentation of 2026.
Sectors driving M&A deal flow in 2026 include:
- Technology and digital services (with a particular focus on fintech scale-ups and AI platforms);
- Healthcare and life sciences (where the UAE and broader GCC—Gulf Cooperation Council—market experiences structurally growing demand);
- Logistics and supply chain (boosted by mega-infrastructure under construction, starting with the expansion of Al Maktoum Airport);
- Commercial real estate and hospitality (where Gulf investor liquidity meets quality assets originating from mature markets).
Legal Framework for Acquisitions in the UAE
Any M&A transaction in the UAE takes place within a regulatory context that presents distinctive characteristics compared to European frameworks. Understanding these features is an essential prerequisite for structuring efficient transactions devoid of hidden legal risks.
Emirati corporate regulation is primarily organized around Federal Decree-Law No. 32 of 2021 on Commercial Companies (UAE Commercial Companies Law, CCL), which governs limited liability companies (LLCs), public joint-stock companies (PJSCs), private joint-stock companies (Private PJSCs), and partnership structures within their respective jurisdictions. Conversely, Free Zones and the financial centers of DIFC and ADGM operate under their own separate regulatory frameworks, which in some cases offer greater structural flexibility.
For target acquisitions in the Emirates, a critical element is verifying the pre-existing ownership structure: despite the 2021 reform, certain activity categories remain reserved for UAE nationals or require a UAE majority shareholding (including commercial agencies, security activities, and specific public service categories). Mapping sector-specific restrictions is the first step of any legal due diligence on a UAE target, an area where DP can assist through its local presence.
An often-overlooked aspect of UAE acquisitions is the regulation of Commercial Agencies: the Emirates possesses one of the most protective frameworks in the world for local commercial agents (UAE Commercial Agencies Law). A registered agent in the UAE can legally block the distribution of a principal’s products within the territory, and their contract is difficult to terminate without compensation. Verifying the existence and nature of Commercial Agency Agreements is an indispensable element of pre-acquisition due diligence.
Due Diligence in the UAE: Market Specifics
The due diligence process on a UAE target features specific nuances that require an approach adapted from European standards. The availability of audited financial and legal information is generally lower compared to markets with public financial statement filing obligations (the UAE does not have a public business registry that mandates the publication of accounts). Consequently, due diligence relies heavily on direct access to corporate documents provided by the target under a non-disclosure agreement, making the quality and experience of the UAE legal team a critical variable.
Areas of heightened complexity in UAE due diligence include:
- Verifying the beneficial ownership of commercial licenses (particularly relevant for Free Zones, where the license is often nominal and not automatically transferable);
- Mapping contracts with government entities or Government-Related Entities (GREs), which frequently contain change-of-control clauses impacting post-acquisition enforceability;
- Verifying compliance with local labor regulations (UAE Labour Law), including employee treatment in change-of-control scenarios;
- Assessing retrospective tax exposure, which—following the introduction of Corporate Tax (CT) in 2023—now includes periods subject to potential tax audits.
Real estate due diligence deserves specific mention, particularly in transactions that include property assets (very common in the UAE market, where real estate is often held directly by operational structures). Real estate property rights in the UAE are governed by specific emirate-level laws, with significant differences between Dubai (where the Dubai Land Department registration system is among the most transparent in the region) and other jurisdictions.
Deal Structuring: From LOI to Closing
Structuring an M&A deal in the UAE follows a logical sequence similar to international standards, but with specific adaptations to the local context that legal teams lacking local experience typically underestimate.
The initial negotiation and documentation phase is typically governed by a Letter of Intent (LOI) or Memorandum of Understanding (MoU) that establishes the essential economic terms and primary procedural covenants (exclusivity, confidentiality, due diligence methods, and timelines). In the UAE, these preliminary documents are generally non-binding regarding economic terms but binding regarding procedural obligations, and they are frequently drafted under UAE or DIFC law depending on the target’s jurisdiction.
The Sale and Purchase Agreement (SPA) is the central contractual document, and its negotiation in UAE deals presents relevant specificities: the system of Representations & Warranties tends to be less elaborate compared to Anglo-American standards, with greater emphasis placed on due diligence as a risk allocation mechanism.
- Price adjustment mechanisms must account for the specificities of UAE accounting and applicable reporting standards.
- Escrow and holdback clauses for post-closing indemnities require careful structuring aligned with available banking options in the UAE.
An area of growing importance in UAE M&A negotiations is the handling of employee rights post-acquisition. The UAE Labour Law mandates specific obligations for the acquiring employer regarding contract continuity and the calculation of the End of Service Gratuity. In mid-to-large-scale transactions, quantifying and managing these obligations forms a significant element of price negotiations.
Acquisition Financing: Options and Structures
The acquisition financing market in the UAE has evolved significantly in recent years, with a growing presence of international banks, private debt funds, and mezzanine finance structures enabling leveraged buyouts that would have been difficult to structure locally just a few years ago.
Primary financing options for UAE acquisitions include: traditional bank financing, available both at major local banks (First Abu Dhabi Bank, Emirates NBD, Abu Dhabi Commercial Bank) and at UAE branches of leading international banks; Islamic financing (Murabaha, Ijarah, Musharakah), which in many transactions involving local counterparts is the preferred or required form; and private debt, with specialized direct lending funds in the UAE market growing significantly due to opportunities created by a combination of high interest rates and robust deal flow.
A specific element of complexity for UAE acquisition financing is the creation of the security package. Establishing pledges on UAE corporate shares (share pledges), mortgages on real estate, and assignments of commercial receivables follows specific UAE rules that differ from European standards, particularly regarding perfection formalities and enforcement mechanisms. A poorly structured security package can render credit protection ineffective in the event of default, which is why the DP Group team, with its presence and experience, can provide the appropriate support for corporate and investor needs.
International Arbitration and Dispute Resolution in the UAE
The resolution of commercial disputes is a critical element in any M&A transaction, and the UAE framework currently offers world-class international options. The choice of dispute resolution forum must be evaluated carefully during negotiation phases, with full awareness of the characteristics, costs, and timelines of each available option.
Primary options include:
- International arbitration under DIAC (Dubai International Arbitration Centre) or ADCCAC (Abu Dhabi Commercial Conciliation & Arbitration Centre) rules, seated in the UAE;
- International arbitration under ICC, LCIA, or SIAC rules seated in Paris, London, or Singapore (frequently chosen by international buyers);
- Litigation before the DIFC Courts or ADGM Courts, for parties opting to litigate within these Common Law jurisdictions;
- Commercial mediation, which is still underutilized in the UAE but growing as an Alternative Dispute Resolution (ADR) tool in commercial disputes between large enterprises.
A defining feature of the UAE system is the Recognition and Enforcement of International Arbitral Awards: the Emirates ratified the 1958 New York Convention, which permits the local enforcement of international arbitral awards through relatively rapid procedures. The 2022 procedural reform further streamlined the recognition process, reducing average timelines from 18–24 months down to 9–12 months.
The Integrated Support of DP Group in UAE M&A Transactions
DP Group offers comprehensive and integrated support for M&A transactions in the United Arab Emirates, spanning from target identification to post-closing integration phases. DP Group’s local team has gained direct experience in transactions covering key sectors of the Emirati economy—from technology to real estate, and from healthcare to logistics—backed by deep knowledge of the sector-specific characteristics that influence deal structuring and execution.
In the buy-side advisory phase, DP Group supports the buyer in mapping available structural options (share acquisition vs. asset deal, offer architecture, price adjustment mechanisms), conducting legal and corporate due diligence, negotiating core contractual documents (LOI, SPA, ancillary agreements), and managing any required regulatory approvals (including notifications to sector authorities and antitrust reviews).
In the sell-side advisory phase, support focuses on the target company and its shareholders, preparing vendor due diligence documents, structuring the transaction to maximize value for exiting partners (including tax optimization of the exit), and negotiating the representations, warranties, and indemnities requested by buyers.
Our deep roots in the UAE, combined with an international network of Advisors in investors’ origin jurisdictions, allow us to act as a genuinely bilateral partner. We understand the expectations and negotiation practices of international buyers while deeply knowing the local context, relationships with authorities, and the nuances of UAE law that dictate the success of an M&A transaction in the region.
In a market where execution speed and the quality of relationships with local counterparts often spell the difference between a deal that closes and one that falls through, the presence of DP Group as a trusted local advisor serves as a tangible competitive factor—not an ancillary service, but a foundational element of the transaction’s value.
DP Group positions itself as the strategic partner for M&A transactions and investments in the United Arab Emirates.
