Like many businesspeople, I have been keeping track of evolving economic developments throughout 2025. It’s a fair observation that recent escalating global tensions and the prospect of rising prices have understandably dented investor confidence time after time throughout the year.
It must be stated, however, that within a global context, the impact on the Middle East is relatively minimal compared to other locations as US tariffs on the UAE and Saudi Arabia were pegged at 10% which is lower compared to other nations.
In contrast to the turbulence in Western markets, the Middle East remains relatively insulated. When it comes to tariffs or trade wars, there’s very much a ‘business as usual’ attitude across the region which is evidenced by regional capital continuing to flow into private markets.
For sovereign wealth funds and family offices, it is full steam ahead – they are still actively deploying capital, often with longer time horizons and a greater tolerance for illiquidity.
Looking more holistically, the Middle East’s resilience presents a unique opportunity for regional managers to capitalize on global dislocation. In practice, this could involve acquiring distressed assets, participating in continuation vehicles, or offering liquidity solutions to international partners. Middle Eastern investors can play a stabilizing role in the global private asset ecosystem.
Other factors stand out in an international context, for instance, private asset managers may face a formidable challenge: how to exit investments in a market gripped by trade wars, geopolitical tensions, inflationary pressures, and a dry fundraising environment. More specifically, traditional exit routes such as IPOs, strategic sales, and secondary buyouts have become less viable, forcing managers to rethink liquidity strategies and investor expectations.
Khalil C. Massoud
Chief Strategy and Investor Relations Officer
Private equity firms, particularly in the United States and Europe, are grappling with a liquidity crunch. High interest rates have dampened valuations, while inflation and geopolitical uncertainty have made buyers more cautious. Trade tensions and regulatory fragmentation have further complicated cross-border transactions. As a result, many managers have resorted to selling assets to other sponsors, often at compressed valuations, just to return capital to investors.
This pressure is compounded by the fundraising drought. Limited partners facing delayed distributions and limited liquidity are increasingly hesitant to commit to new funds. The recycling of capital through continuation vehicles has emerged as a popular workaround, allowing general partners to extend the life of quality assets while offering partial liquidity to existing investors.
Continuation funds are no longer niche. They’ve become a mainstream tool for managing portfolio maturity and investor liquidity. These vehicles allow general partners to roll over assets into new structures, often backed by secondary buyers, while offering LPs the option to cash out or reinvest. While not fully exit, they provide breathing room in a market where time is a scarce commodity.
Other creative exit mechanisms are gaining traction as well. Mergers between portfolio companies, dividend recapitalizations, and structured sales with earn-outs or deferred consideration are increasingly common. These non-cash exits offer flexibility but require careful structuring to align interests and preserve value.
The exit environment for private assets is unlikely to normalize soon. Managers must embrace flexibility, transparency, and innovation to navigate this new reality. Whether through continuation funds, structured exits, or regional partnerships, the goal remains the same: delivering value and liquidity in a world where both are increasingly elusive.
In September 2024, Alpha Dhabi Holding exited its 11% equity stake in OCI’s Global Methanol Business following the acquisition of this business by Methanex Corporation. The transaction saw OCI Global sell its methanol business to Methanex for $2.05 billion, which was a combination of cash and Methanex shares, with Alpha Dhabi Holding receiving a portion of the proceeds from this acquisition.
Alpha Dhabi Holding also exited several hospitality assets in March 2025 via contribution of assets in lieu of shares in National Corporation for Tourism and Hotels (NCTH). This transaction resulted in ADH becoming a controlling shareholder of NTCH with 73.3% of its paid up capital.
Again, this is where the Middle East stands out. ‘Stability’ has become a watchword in the Gulf, especially when it comes to the broader economic resilience story. Despite the rapidly emerging international context, the Gulf continues to stand out for these complementary factors including political, economic, and legal systems as well as diversified export profiles and significant capital reserves. This basket of advantages gives confidence and assurance to investors; it presents certainty during uncertain times.