DealMakers AFRICA Q2 2019

From the editor's desk

The rapid pace at which Africa moves towards the fourth Industrial Revolution (4IR) will be a game changer for the continent. Hamstrung by massive infrastructure deficits, the World Bank estimates that Africa needs more than $90bn a year to bridge the infrastructure gap; 4IR technologies such as artificial intelligence (AI) and the internet of things (IoT) will accelerate socio-economic development particularly in the fields of education, agriculture, healthcare and financial services.

While there are numerous exciting examples of how technology is transforming lives, it is important to remember that to truly transform society, governments need to ensure their people have access to the basics such as clean water and electricity.

Aligned to this, the continent has been a focal point for impact investing (page 5). Impact investing, the investment made into companies and funds with the intention to generate a measurable, beneficial social or environmental impact alongside a financial return, presents a multitude of underserved sectors where a social or environmental impact can be made, and has a high incidence of maturing frontier markets that offer high potential returns for those willing to bear with the political, economic and security risks present. Private equity deals across the continent continue to play a key role in assisting innovative and dynamic African companies providing both capital and experience. Deals expose investors to sectors such as infrastructure, technology, healthcare and education, and other segments of the economy which are not necessarily available when investing in the listed markets.

Analysis of H1 merger and acquisition data collected by DealMakers AFRICA (excluding South Africa) shows the total value of deals at $87,39bn for the period. If foreign deals are excluded (see criteria pg 20) the value drops to $15,33bn from 207 deals. By region, the most active was East Africa with 67 deals, of which 46 were recorded in Kenya with a value of $794m. West Africa recorded 56 deals with Nigeria, unsurprisingly, the most active with 33 deals. By value, Central Africa led the tables at $2,7bn off just nine deals – the majority of which involved mining and energy assets. Private equity deals, which are included in the regional numbers, were most prominent in Kenya, with 24 investments during the period followed by Nigeria (20) and Morocco (7).

DealMakers AFRICA had hoped to run H1 league table rankings for the regions East and West Africa. But, until such time as advisory firms submit deals and transactions on which they have worked, it is impossible to provide meaningful rankings showcasing the skills of the local advisory firms.

We have, however, run an M&A pan-African league table for the period (page 4). 
 

Marylou Greig

© 2018 Gleason Publications (Pty) Ltd

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