Mergers & Acquisitions in Dubai and the UAE

Quick Summary: mergers and acquisitions in the UAE

• What M&A advisory is: the guidance that gets a business bought or sold – valuation, finding or vetting the other side, structuring the deal, running due diligence, and negotiating the sale-and-purchase agreement through to completion. Advisers act sell-side (for the seller) or buy-side (for the buyer).
• Tax on an exit is light: the UAE has no personal capital gains tax, and a company selling a Qualifying Shareholding pays 0% Corporate Tax on the gain under the participation exemption – broadly a stake of 5% or more (or costing AED 4 million+), held for at least 12 months.
• Bigger deals need clearance: since the 2026 merger-control rules, an acquisition where the parties’ UAE sales in the relevant market exceed AED 300 million must be notified to the Ministry of Economy and cannot close during review.
• Ownership is no longer a blocker: 100% foreign ownership on the mainland has removed a barrier that used to complicate UAE deals.
• Timeline: a typical mid-market deal runs three to six months from mandate to completion; clearances and financing can extend it.

Buying or selling a company is the biggest transaction most owners ever do, and the UAE has quietly become one of the best places to do it: no personal capital gains tax, a participation exemption that can make a share sale tax-free, 100% foreign ownership, and – new since 2026 – a proper merger-control regime for large deals. This guide sets out how M&A works here, what an adviser does on each side, the process and timeline, the tax and regulatory rules that matter, and the mistakes that break deals.

“Most sellers leave money on the table in the first meeting, not the last. Value is set long before the SPA – in how you prepare the business, structure the process and create competition. By the time you are negotiating price, the ceiling is largely fixed.”

— Reviewed by CA Akbar Ali, Financial & Regulatory Specialist

What M&A advisory actually is

An M&A adviser runs the transaction so the client does not have to. On a sell-side mandate that means preparing the business, building the information pack, finding and qualifying buyers, running a competitive process, and holding the line on value through due diligence and the sale-and-purchase agreement (SPA). On a buy-side mandate it means sourcing targets, valuing them, coordinating due diligence, structuring the offer, and negotiating terms that protect the buyer.

The adviser sits between the lawyers, the accountants and the banks, keeps the deal moving, and manages the emotional swings that derail owner-led sales. It is part finance, part negotiation, part project management.

Who needs M&A advisory

• Founders exiting – a full sale, a partial cash-out, or bringing in a partner.
• Buyers and acquirers – corporates and investors growing by acquisition rather than building from scratch.
• Groups consolidating – merging entities, buying out minority shareholders, or carving out a division.
• Private-equity-backed platforms running buy-and-build roll-ups across the GCC.
• Family businesses professionalising or preparing an ownership transition.

The M&A process, step by step

1. Mandate and preparation. Agree the objective and, sell-side, prepare the business, the financial model and the information memorandum.
2. Valuation. Set a defendable range using earnings multiples and, where useful, a discounted-cash-flow view.
3. Market and NDA. Approach buyers or targets under confidentiality, and qualify genuine interest.
4. Letter of intent / term sheet. Agree headline price and structure, usually with a period of exclusivity.
5. Due diligence. The other side examines financial, tax, legal and commercial detail. This is where deals are re-priced or lost – see our UAE due diligence guide.
6. SPA negotiation. Price, warranties, indemnities, escrow and conditions are settled in the sale-and-purchase agreement.
7. Clearances. Where thresholds are met, merger-control and any sector approvals are obtained before closing.
8. Completion and integration. Funds and shares change hands; the buyer integrates.

Share deal or asset deal

How you buy changes the risk, the tax and the paperwork. The two routes:

Feature	Share deal	Asset deal
What transfers	The company’s shares – the business, with its history	Selected assets and liabilities only
Liabilities	Buyer inherits them – diligence is critical	Buyer usually leaves them behind
Seller tax	May qualify for the participation exemption (0%)	Gain sits in the company; ordinary rules apply
Typical preference	Sellers often prefer it	Buyers often prefer it for a clean start

Which side wins that argument is part of the negotiation, and it is often where an adviser earns their fee. Acquisitions are frequently made through a new holding company or SPV.

UAE merger control: the new rules

Until recently the UAE had little practical merger review. That changed with Federal Decree-Law No. 36 of 2023, the 2025 filing thresholds and the 2026 executive regulations, which created a working merger-control regime. In short:

• Threshold: if the parties’ combined annual sales in the relevant UAE market exceed AED 300 million, the deal must be notified. A market-share test can also bring a deal in scope.
• Suspensory: notification goes to the Ministry of Economy and the deal cannot complete during review.
• Timeline: the review runs to around 90 days from a complete filing, extendable, with a short completeness check up front.
• Teeth: the Ministry can fine the parties, and can unwind a deal that closed without clearance.

Most SME deals fall below the threshold, but any sizeable transaction now needs a clearance check built into the timetable. Confirm the current thresholds and exemptions before you sign.

Tax on a UAE deal

The tax position is one of the UAE’s biggest M&A attractions:

• No personal capital gains tax. An individual selling shares in their own company generally pays no UAE tax on the gain.
• Participation exemption. A company selling a Qualifying Shareholding pays 0% Corporate Tax on the gain – broadly a stake of at least 5% (or costing AED 4 million or more), held for at least 12 months, in a subsidiary taxed at 9% or a comparable basis. Qualifying dividends are exempt too.
• Structure matters. Holding the target through a UAE holding company is how many groups access the exemption on a future exit.

The exact conditions are set by the Ministry of Finance and administered by the Federal Tax Authority and are detailed; take formal advice, and see our UAE Corporate Tax guide.

How a business is valued

Two methods do most of the work. Earnings multiples apply a market multiple to profit (commonly EBITDA), benchmarked to comparable deals and companies. A discounted cash flow values the business on its projected future cash, discounted to today. Advisers triangulate the two, then adjust for net debt, working capital and deal-specific risk. The number a seller hears first and the number that survives due diligence are rarely the same – preparation is what protects it.

The documents a deal runs on

• NDA – confidentiality before anything is shared.
• Information memorandum – the sell-side pack on the business.
• Letter of intent / term sheet – headline terms and exclusivity.
• Due diligence reports – financial, tax, legal and commercial.
• Sale-and-purchase agreement (SPA) – price, warranties, indemnities, conditions.
• Disclosure letter and escrow arrangements – managing residual risk after completion.

What M&A advisory costs

Advisory fees are usually a modest monthly retainer plus a success fee – a percentage of deal value that falls as the deal size rises. Budget separately for legal drafting and for the buyer’s or seller’s due diligence. The retainer keeps the process resourced; the success fee aligns the adviser with getting the deal done at the right price. Sketch the corporate side of a new acquisition vehicle with our free UAE setup cost calculator.

Five mistakes that break M&A deals

• Selling without preparation. Going to market with messy accounts and no data room caps your price before you start.
• No competitive tension. A single buyer sets the terms; a real process creates leverage.
• Ignoring merger control. On a large deal, missing the AED 300 million notification can fine you and unwind the transaction.
• Weak due diligence (buy-side). Inheriting hidden liabilities in a share deal is expensive; diligence is the protection.
• Leaving tax to the end. The right structure – and a qualifying holding – is what makes an exit tax-efficient. Design it early.

Frequently asked questions

Do I pay tax when I sell my UAE business?

Individuals pay no personal capital gains tax on selling shares. A company selling a Qualifying Shareholding pays 0% Corporate Tax on the gain under the participation exemption - broadly a stake of at least 5% (or AED 4 million+), held for 12 months. Confirm the conditions with the Federal Tax Authority.

What is the difference between sell-side and buy-side advisory?

Sell-side advisers represent the seller - preparing the business, finding buyers and maximising value. Buy-side advisers represent the buyer - sourcing and valuing targets, running diligence and negotiating protective terms.

Does my deal need government approval?

Since 2026, if the parties' combined UAE sales in the relevant market exceed AED 300 million, the deal must be notified to the Ministry of Economy and cannot close during review. Most SME deals fall below this, but large deals must build clearance into the timetable.

Share deal or asset deal - which is better?

Sellers often prefer a share deal (and its potential tax exemption); buyers often prefer an asset deal for a clean start without inherited liabilities. It is a core point of negotiation and depends on the specific business.

How long does an M&A deal take?

A typical mid-market deal runs three to six months from mandate to completion. Due diligence, financing and any merger-control clearance can extend it.

How is a business valued?

Mainly by earnings multiples (a market multiple applied to profit such as EBITDA) and discounted cash flow, adjusted for net debt, working capital and risk. Preparation is what protects the value through due diligence.

What does M&A advisory cost?

Usually a monthly retainer plus a success fee - a percentage of deal value that scales down as the deal grows - with legal and due-diligence costs on top.

Can a foreigner buy 100% of a UAE company?

Yes. 100% foreign ownership is now allowed for most mainland activities, which has removed a barrier that used to complicate UAE acquisitions.

Sources and official references

Related guides

• Due diligence in the UAE
• Holding company in the UAE
• Capital structuring: debt vs equity
• UAE Corporate Tax guide
• Free UAE setup cost calculator
• Talk to an adviser

This guide is general information, not legal, tax or financial advice. Merger-control thresholds, the participation exemption and Corporate Tax rules are set by the UAE Ministry of Economy, Ministry of Finance and Federal Tax Authority and change over time; figures are indicative and current at the time of writing. Confirm current requirements with the relevant authority, or a licensed adviser, before you act.