The DealMakers AFRICA Q3 2025 is out now!
DealMakers AFRICA Annual Awards - March 2026
Lagos, Nigeria & Nairobi, Kenya
DealMakers AFRICA Q3 2025 issue
M&A Regional Analysis Q1 - Q3 2025
PE Regional Analysis Q1 - Q3 2025
Largest M&A Deals Q1 - Q3 2025
DealMakers Africa Awards EAST AFRICA | Nominations
DealMakers Africa Awards WEST AFRICA | Nominations
THORTS
The era of indiscriminate capital deployment in Africa is over
By Teurai Nyazema | Nedbank CIB
Does regional integration increase M&A regulatory burden?
By Amalia Lui | Clyde & Co Tanzania
Critical minerals in Southern Africa: Balancing geopolitics, regional integration and value addition
By Nomsa Mbere | Webber Wentzel
Private Equity and Wheeling: Financing the shift to decentralised power
By Nomsa Sibanyoni and Khanyisile Malebe | PSG Capital
The 2025 M&A report: the Africa perspective
By Seddik El Fihri | BCG in Casablanca
CONTENTS
FROM THE EDITOR'S DESK
2025’s African mergers and acquisitions have been shaped by shifting global trade dynamics, as geopolitical uncertainty, evolving US policy, growing regional integration, and a fast-moving digital economy continue to redefine investment behaviour. On the global stage, US President Donald Trump’s tariff-driven agenda has not only reshaped international alliances, but has also sharpened focus on the African Continental Free Trade Area (AfCFTA) – set to become the world’s largest free-trade bloc.
DealMakers’ analysis of the first nine months of 2025 shows that one-third of cross-border transactions undertaken by South African-domiciled, exchange-listed companies involved other African countries, underscoring the growing significance of intracontinental dealmaking.
Across the continent (excluding South Africa), overall deal activity continued its downward trend. Deal value declined a further 6% year-on-year to US$6,85 billion, following a 10% drop in 2024. The number of deals fell to 259, from 282 in the prior period. West Africa, and particularly Nigeria, led activity with 78 deals (Nigeria accounting for 45), followed by North Africa with 67 (43 for Egypt) and East Africa with 63 (37 in Kenya) (pg 3).
General Corporate Finance (GCF) activity mirrored this moderation. For the first nine months of the year, DealMakers Africa recorded 64 transactions (excluding bonds) valued at $2,2 billion, compared with 88 transactions valued at $10,4 billion in 2024. Among the standout transactions was Sun King’s $156 million securitisation, the largest and first majority commercial-bank-backed transaction of its kind in sub-Saharan Africa outside South Africa.
Despite these headwinds, Africa’s structural strengths continue to attract investment. The continent is home to some of the world’s fastest-growing economies, and boasts the fastest-growing working-age population, coupled with rapid digital adoption. Together, these trends present significant opportunity, particularly for private equity investors backing technology scale-ups in an era of tightening global liquidity.
Private equity is no longer viewed as an unconventional funding route, but rather as an increasingly reliable engine for scale, consolidation and long-term value creation, and a pivotal driver of M&A. Still, the sector has not been immune to global pressures, regional risks, and shifts in investor strategy. Private equity deals for the period totalled 114, just one-third of 2022 levels (pg 4), reflecting the impact of constrained capital and elevated risk premiums.
Among the top transactions for the year, four mining deals featured in the 10 largest by value. Leading the list was Vitol’s $1,65 billion acquisition from Eni of a 30% participating interest in the Baleine project in Côte d’Ivoire, and a 25% stake in the Congo LNG project in the Republic of Congo (pg 6).
A reminder that the DealMakers AFRICA Awards will take place in March 2026, recognising M&A achievements in East and West Africa at events hosted in Nairobi and Lagos respectively. Nominations for Deal of the Year, Private Equity Deal of the Year, and the Individual DealMaker of the Year for each region close on 16 January 2026. Full nomination criteria can be found on pages 26 - 33.
Marylou Greig
THORTS
The era of indiscriminate capital deployment in Africa is over
Teurai Nyazema
A new age of focused, strategic and value-accretive dealmaking is reshaping the continent’s investment landscape.
Despite a wave of headline-making exits across parts of Africa by multinational corporations and institutional investors, international interest in the continent remains resolutely intact. Rather than signalling a wholesale retreat, these exits reflect a rebalancing of portfolios, as investors recalibrate strategies to focus on scalable, high-growth opportunities, better-aligned partnerships, and regional integration plays.
Teurai Nyazema
Over the past decade, several international corporates have exited African markets that were once deemed essential to their growth plans. Yet these exits are not indicators of fading interest. In most cases, they reflect the operational realities of certain territories – currency volatility, regulatory challenges or subscale operations – and a pivot towards core larger and scalable markets or higher-performing regions. In parallel, many multinational investors are doubling down in countries like Kenya, Nigeria, Egypt, South Africa and Morocco, where underlying fundamentals remain robust, and consumption-driven growth continues to accelerate.
An example of the maturity of Africa’s investment landscape is evident through the example of LeapFrog Investments’ full exit from Goodlife Pharmacy, East Africa’s largest retail pharmacy chain. In July 2025, LeapFrog sold its remaining stake in Goodlife to CFAO Healthcare, a subsidiary of Toyota Tsusho Corporation and one of the most active healthcare distribution networks on the continent. This was no ordinary exit. LeapFrog had invested in Goodlife in 2017, when the business operated just 19 stores. Over the course of its investment, LeapFrog helped scale the platform to over 150 outlets across Kenya and Uganda, building the region’s most trusted branded pharmacy network.
The business now serves more than 2 million customers annually, and has become a case study in how strategic capital, operational discipline and impact-led governance can generate both outsized returns and systemic healthcare value.
CFAO Healthcare’s acquisition reflects the growing appetite from international strategic buyers to expand into Africa via ready-made scalable platforms. As a distributor with reach across over 40 African countries, CFAO gains a direct-to-consumer presence and a vertically integrated foothold in the pharmacy retail segment – a segment that is formalising rapidly across the continent. LeapFrog, in turn, successfully exited to a long-term operator capable of taking the platform to the next stage of growth.
The lesson from transactions like Goodlife is clear: international players are still interested in Africa, but their approach is more targeted. They seek assets that are scalable, well governed, and regionally relevant. Increasingly, they are acquiring not greenfield operations, but platforms that include businesses that have been de-risked, have been professionally managed, and demonstrate a clear path to expansion.
Africa’s consumer story remains intact. With over 1,4 billion people and a significant and growing middle class, the demand for quality healthcare, food, financial services, digital connectivity and logistics infrastructure continues to rise. Global players from Japan, France, the United States, Saudi Arabia, the United Kingdom, the United Arab Emirates and India are actively evaluating acquisition opportunities in these sectors across the continent. The increasing interest in both digital infrastructure and logistics infrastructure in Africa by players from these regions shows the appreciation for the current ongoing African economic energy, as well as the future growth to be achieved from the investment taking place today.
At the same time, private equity investors and development finance institutions (DFIs) are focusing on exit mobilisation, transitioning their portfolios to long-term operators or strategic buyers. The recycling of capital from LeapFrog into CFAO is precisely the kind of liquidity event that reinforces confidence in Africa’s private capital ecosystem. International interest in African assets is not waning – it is evolving. Investors are being more selective, favouring markets with political stability, rising urbanisation, and proven business models. Local knowledge, experienced advisers and credible partnerships will be key to unlocking continued capital flows.
Local knowledge and partnerships are proving to be a vital part of the strategy of international acquirers when evaluating various African platform opportunities. The ability to navigate, operate and understand the nuances of local and regional markets brings its own value to companies on the continent. While many African businesses still possess strong family shareholdings, this has been shown to provide comfort and reassurance to international partners.
The next wave of mergers and acquisitions across Africa will see a major refocus of all parties involved in the deal-making landscape, with a keen focus by PEs and DFIs on potential exit routes of new investments, while international players have a much more focused strategy and eye on the long-term future of the African businesses within their portfolios.
Nyazema is an Associate Principal: Corporate Finance | Nedbank CIB.
THORTS
Does regional integration increase M&A regulatory burden?
Amalia Lui
This is a tricky topic, which has recently become increasingly important for entities which operate across multiple jurisdictions in Africa. Regional integration, in the form of the SADC, COMESA, EAC and AU (regional organisations), is meant to bring uniformity among the member states. The aim is to remove trade barriers, promote easy movement of labour, increase cross border investment and, in some cases, to facilitate easy access to capital for public and private entities, with better terms through financial institutions established and funded by the regional organisations. However, despite the benefits of regional integration, there is a challenge lurking behind the scenes, in the form of the M&A regulatory burden posed by the regional organisations.
ANTI-TRUST AND MERGER APPROVALS
Amalia Lui
Some African countries have national merger authorities (NMAs) which are responsible for merger approval processes, and each of these countries’ NMAs has unique key areas on which they focus. Historically, entities operating in multiple African countries would file merger approvals with the NMA in each of those countries. However, regional organisations are now focusing on becoming more integrated and uniform to prevent anti-competitive behaviour and monopoly across the continent, so merger approvals from the regional competition authority are increasingly required. Unfortunately, NMA approvals and local competition laws remain intact and do not cede to the regional competition authority, which means that M&A transactions are notified at both the NMA and regional organisation level. Trying to navigate the multiple regulatory hurdles contributes significantly to the regulatory burden, including time and cost.
Arguments have been presented that national authorities should focus on the local policies, laws and economic impact of the transaction within the member state, while the relevant regional organisations should focus on the impact across multiple African countries. While this argument is valid, there should be proper integration and uniformity, where each NMA is entrusted with the duty to focus not only on its own market, but also on how the M&A transaction affects the member states of the regional organisation. Alternatively, the NMA should cede control to the relevant regional organisation to make such analysis, with internal dialogue and correspondences between the regional organisation and the NMA to avoid multiple filings.
REGULATORY APPROVALS
Aside from the anti-competition approvals, there may be lack of support or uniformity by regional organisations when it comes to regulatory approvals across multiple jurisdictions on the continent. Some jurisdictions have simpler regulatory controls, while others impose more stringent requirements. These can include free carry in favour of the member state, and/or mandatory local ownership requirements to qualify for the granting of some permits/licences or approvals. It becomes a challenge for businesses to navigate different regulatory approval requirements across each of these jurisdictions, which then hinders cross border investment and the easy flow of capital between member states. With regional organisations pushing for more integration and uniformity, this aspect must be investigated, especially for businesses which have attained an agreed threshold to qualify for merger approval with the regional competition authority.
DIVERGENT TAX REGIMES
The inconsistency of tax frameworks across member states belonging to the same regional organisation calls for harmonisation. These inconsistencies range from withholding tax obligations, rates and accrual, capital gains tax rates and assessment mechanisms, and VAT frameworks, among others. Ultimately, M&A transactions have to comply with the tax laws of each jurisdiction, but in some instances, approvals and implementation timeframes differ significantly from one member state to another. Overall, this impacts the confidence of investors seeking entry into the continent. In addition, it affects the financial support from external financiers, since the continent still largely depends on financing from non-African financial institutions and banks.
Regional integration should unlock growth, not entrench fragmentation. Aligning competition, regulatory and tax laws, policies and systems should be a priority. It is the key to turning Africa’s economic blocs into engines of cross-border investment. It should make us more competitive and reduce the hurdles of investment across member states, whether emanating from within or from outside the continent.
Lui is a Partner | Clyde & Co (Tanzania)
THORTS
Critical minerals in Southern Africa: Balancing geopolitics, regional integration and value addition
Nomsa Mbere
As the global economy undergoes a profound transformation towards low-carbon energy systems and digital technologies, critical minerals such as lithium, cobalt, platinum group metals (PGMs), rare earth elements (REEs) and graphite have emerged as key enablers of this transition. These minerals underpin everything from electric vehicles (EVs) and renewable energy to semiconductors and hydrogen fuel systems.
Rising demand has elevated these minerals from mere commodities to strategic assets that define national security, industrial competitiveness and geopolitical alignment. The Southern African Development Community (SADC), richly endowed with many of these resources, finds itself at the epicentre of this global shift.
Nomsa Mbere
While Southern Africa’s mineral wealth presents a generational opportunity, resource abundance alone does not guarantee economic transformation. To fully leverage its position, the region must transition from being a raw material supplier to a strategic industrial partner, anchored in coherent policies, regional cooperation and value chain development.
THE GLOBAL RACE FOR CRITICAL MINERALS: Opportunity and risk
Southern Africa’s strategic positioning must be understood within the broader context of intensifying global competition over critical mineral supply chains. China’s dominance in processing key inputs, particularly rare earths, lithium and graphite, has prompted countries like the United States (US) and the European Union (EU) to ‘de-risk’ their supply chains by diversifying sources. This has translated into a wave of new trade policies, strategic partnerships and investment frameworks increasingly focused on Africa.
Bilateralism and fragmentation risks
The US, for example, has signed separate critical minerals agree-ments with Zambia and the Democratic Republic of Congo (DRC), marking a shift from multilateral co-operation to bi-lateral engagement. While these partnerships signal increased interest in the region, they also risk fragmenting regional cohesion. Country-by-country deals reduce the collective bargaining power of African nations and complicate efforts to coordinate regional industrial strategies, particularly in downstream beneficiation and infrastructure planning.
The rise of resource nationalism
At the same time, growing resource nationalism across the Global South, manifested through export restrictions, local content mandates and beneficiation requirements, signals a shift in approach. African countries increasingly recognise that controlling their mineral endowments and capturing more value domestically is not only a matter of economic benefit, but also essential to long-term development and strategic autonomy.
DEFINING CRITICALITY: A continental mosaic of priorities
Despite the shared importance of critical minerals, SADC countries define ‘criticality’ differently, reflecting diverse economic structures, industrial capacities and development goals. For instance, South Africa prioritises PGMs, manganese, vanadium and iron ore due to their economic contributions, while placing less emphasis on lithium and copper. Zambia, Zimbabwe and Namibia, in contrast, consider lithium, copper and rare earths as top priorities.
This lack of standardisation presents a challenge for regional alignment. Moreover, while producer countries focus on domestic benefits like jobs, revenues and industrialisation, consumer countries define criticality based on supply chain security, scarcity and import risks.
A shared, science-based and forward-looking regional framework is therefore essential. It must respect national priorities, while aligning with global trends in clean energy, digital infrastructure and advanced manufacturing. This framework should also promote inclusive industrial growth, especially by integrating artisanal and small-scale mining (ASM), which often plays an outsized role in supplying niche minerals.
NATIONAL STRATEGIES IN MOTION: Parallel paths, shared aspirations
Across SADC, countries are advancing domestic strategies to increase value capture from critical minerals.
-
Zimbabwe has implemented a phased approach to restricting lithium exports, beginning with a ban on raw ore and extending to a planned ban on lithium concentrate exports by 2027, to promote domestic value addition and battery-related manufacturing.
-
Namibia is enhancing rare earth processing capacity, supported by strategic partnerships and investment facilitation from the EU.
-
Zambia and the DRC are collaborating to develop copper and EV battery value chains, supported by US-backed agreements and infrastructure initiatives, most notably the Lobito Corridor railway project.
-
Botswana is diversifying beyond diamonds by developing projects to process minerals like manganese into battery-grade materials, while expanding renewable energy infrastructure to support its clean energy ambitions.
However, these national approaches, while promising, also risk duplicating efforts and diluting investment. Without coordination, multiple countries could build similar infrastructure (e.g. smelters, refineries), leading to suboptimal returns and missed synergies.
There is an urgent need for value chain rationalisation. Instead of each country building all components of the beneficiation chain, the region should strategically allocate functions across borders, based on competitive advantage. For example, Botswana – with its central location, access to the Kalahari Copper Belt, and vast salt pans – could serve as a processing and logistics hub, linking copper from Zambia and lithium from Zimbabwe.
Such coordination could form the foundation of a regional industrial strategy that maximises shared benefits while avoiding inefficient competition. Examples such as regional gold refining in Germiston (which services multiple SADC states under existing Rules of Origin provisions) illustrate that practical cross-border beneficiation is possible when regulatory frameworks are aligned and infrastructure is leveraged.
INFRASTRUCTURE AND INTEGRATION: Building the backbone of value chains
Value chain coordination cannot occur in isolation; it must be supported by physical and regulatory infrastructure. This includes transport, energy, water and digital systems. Equally important are trade-enabling legal instruments such as the SADC and AfCFTA Rules of Origin, which, through provisions like ‘cumulation’, allow components sourced across member states to be treated as local inputs, facilitating integrated processing and manufacturing.
Projects like the Lobito Corridor, linking the DRC and Zambia to Angola’s ports, are a positive step. But more corridors, such as Nacala, Walvis Bay and Beira, are needed. These routes should not merely facilitate mineral exports, but evolve into industrial development corridors, fostering downstream beneficiation and local economic ecosystems along their paths.
Botswana, strategically located at the crossroads of Southern and Central Africa, could emerge as a regional transport and processing hub. With deliberate planning, corridors can become economic arteries, enabling integrated clusters of processing, manufacturing and technology development, ranging from battery assembly to hydrogen electrolyser production.
Crucially, these corridors must complement rather than compete. Each offers unique advantages based on geography, resource type and trade routes. A coordinated approach would ensure that corridor development supports regional scale and resilience, rather than creating redundant infrastructure.
THE COST OF FRAGMENTATION: Missed opportunities and market failure
The cost of failing to act collectively is significant, as illustrated by several examples:
-
Despite Southern Africa’s global dominance in platinum, the industry remains largely a price taker, exporting predominantly unrefined concentrate. This persists even as the region leads in fuel cell research and development, missing opportunities to capture greater value through downstream processing.
-
Zimbabwe exports significant volumes of spodumene concentrate, a lithium precursor, but without domestic battery manufacturing capacity, much of the economic value is realised offshore, limiting local industrial development and job creation.
-
Botswana hosts Africa’s largest salt pan system, the Makgadikgadi Pans, which is under active exploration for lithium brines. However, the country currently lacks operational lithium extraction or value addition facilities, leaving it disconnected from the regional lithium and EV battery value chains.
Without coordinated, integrated regional planning, Southern Africa remains vulnerable to commodity price volatility, and reliant on foreign actors for downstream processing and value addition. These structural inefficiencies constrain economic growth and undermine the region’s capacity to influence and benefit from global mineral supply chains.
VALUE ADDITION: Transforming mineral potential into industrial power
To change this trajectory, beneficiation must be at the heart of the region’s strategy. With nearly 70% of global PGMs sourced from South Africa and Zimbabwe, SADC holds sufficient market power to demand downstream investment, just as Indonesia did with nickel.
The growing prominence of the hydrogen economy enhances this leverage, given the importance of PGMs in fuel cells and electrolysers. Regional efforts to develop R&D capabilities, supply chain infrastructure and technology transfer should focus on moving beyond raw exports to high-value industrial outputs.
Countries are already moving in this direction:
-
Zimbabwe is implementing a beneficiation roadmap for lithium and chrome.
-
Namibia is attracting REE and hydrogen investment.
-
Botswana is expanding processing beyond diamonds.
-
Zambia and the DRC are deepening cross-border copper value chains.
Yet energy constraints, limited capital and weak digital infrastructure remain major bottlenecks. Among all infrastructure categories, power access and affordability stand out as the most pressing and potentially transformative investment areas.
ENABLING INVESTMENT THROUGH LEGAL COHERENCE AND ESG ALIGNMENT
The legal landscape across SADC is evolving, with countries updating mining codes, export regimes and local content rules. However, the lack of harmonisation remains a source of uncertainty and delays, particularly for junior and ESG-focused investors.
Existing instruments like the SADC Protocol on Trade in Goods and its Rules of Origin (RoO) provide preferential access to intra-regional markets, often recognising minerals as wholly originating goods. Value-added products also qualify, provided they meet moderate RoO thresholds. The AfCFTA Protocol on Trade in Goods offers a continental framework closely aligned with SADC’s RoO principles and includes provisions for cumulation, broadening opportunities for cross-border beneficiation chains.
Establishing a regional engagement platform within SADC could facilitate legal alignment, streamline permitting, and promote coordinated investment planning, enhancing the region’s appeal to responsible investors while respecting national sovereignty.
Equally critical is adherence to Environmental, Social and Governance (ESG) standards, now essential for access to global markets. Embedding digital traceability, environmental certification and community inclusion into policy and practice is vital. Formalising ASM, ensuring transparent licensing, and introducing ESG incentives can strengthen the region’s reputation and competitiveness.
Together, these trade instruments create important enablers for cross-border industrialisation. The key challenge now is to translate these frameworks from legal availability into practical accessibility through coordinated customs enforcement, institutional capacity building, and increased awareness among public and private stakeholders.
GLOBAL ALIGNMENT: SADC’s strategic moment on the world stage
The launch of the G7 Critical Minerals Action Plan in 2025 presents a timely opportunity for Southern Africa to align its development priorities with growing global demand for responsibly sourced critical minerals. Many of the plan’s key focus areas – such as supporting local beneficiation, financing infrastructure projects, and harmonising ESG practices – already feature prominently in SADC’s regional strategies. This alignment positions the region to leverage global momentum to build resilient and transparent mineral supply chains.
A particularly important aspect of the G7 plan is its recognition of Artisanal and Small-Scale Mining (ASM), which remains a vital source of niche, high-value minerals, and a major employer across Africa. By formalising ASM, the region will not only improve livelihoods; it will increase transparency and address environmental and social challenges associated with informal mining activities.
To capitalise on global trends, SADC countries should actively engage with international initiatives that support critical mineral development and sustainable infrastructure investment, such as the:
-
Minerals Security Partnership, an international coalition focused on responsible sourcing and supply chain resilience.
-
Canada-led Critical Minerals Production Alliance, emphasising investment collaboration.
-
EU–Africa Global Gateway, the EU’s flagship infrastructure programme with a focus on green minerals and energy transition partnerships.
-
Green Hydrogen Alliance, promoting global hydrogen development, a sector where Southern Africa’s abundant renewable resources and mineral wealth could play a strategic role.
By deepening engagement with these platforms, SADC can strengthen its position globally, attract responsible investment, and ensure that its critical minerals contribute meaningfully to both local development and the global clean energy transition.
From resource custodians to strategic co-creators
The global transition to green energy, digitalisation and strategic autonomy has placed critical minerals at the heart of economic and geopolitical realignment. With its vast mineral wealth, Southern Africa is no longer a peripheral player, but a pivotal force shaping global supply chains.
The region’s success hinges on collective, strategic action. The choice is clear: remain fragmented exporters of raw ore, or unite as industrial partners driving downstream industries, innovation and sustainable growth.
This transformation demands five core shifts:
-
From bilateral deals to coordinated regional strategy: SADC must strengthen collective bargaining through integrated policies and value chain coordination.
-
From export dependency to onshore value addition: Beneficiation and manufacturing must move from ambition to reality, supported by competitive infrastructure and energy access.
-
From siloed infrastructure to interconnected corridors: Strategic transport corridors like Lobito, Nacala and Walvis Bay should evolve into multi-country industrial belts, enabling regional value chains.
-
From legal complexity to investor confidence: Harmonised mining, energy and ESG frameworks will reduce barriers, attract finance, and empower junior miners and ASM actors.
-
From marginal voices to global rule-shapers: Active engagement in platforms like the G7 Minerals Security Partnership and African Union strategies is essential to embed Africa’s interests in the green transition.
Ultimately, vision must be matched by execution. Political will, institutional capacity and regional trust are vital. If SADC acts with unity and urgency, it can move beyond benefiting from the critical minerals boom to leading it.
Mbere is a Partner | Webber Wentzel
THORTS
Private Equity and Wheeling: Financing the shift to decentralised power
Nomsa Sibanyoni and Khanyisile Malebe
Nomsa Sibanyoni
Africa’s energy story is undergoing a fundamental shift in 2025, as c.600 million Africans lack access to electricity. Rolling blackouts, rising tariffs and strained utilities have forced commercial institutes to look for alternatives, while investors are searching for sustainable, long-term returns. At the centre of this intersection sits wheeling, which allows independent power producers (IPPs) to deliver electricity directly to commercial institutes through the grid. For private equity, wheeling offers more than just a niche investment play. It represents a scalable platform for financing decentralised power, while giving customers reliable, typically cleaner, energy that bypasses overburdened state utilities.
THE POWER OF WHEELING
Wheeling can be explained as an IPP “wheeling” electricity that it has generated across the existing grid to a consumer, even if the two are not physically connected. Contracts and network charges govern the transaction, making it possible for commercial institutes to secure renewable supply without having to build their own dedicated infrastructure.
FROM DARK TO DAWN
African private sector clean energy investments surged to nearly US$40 billion in 2024, with solar capacity alone exceeding 20 gigawatts, and over 10 gigawatts under construction, primarily driven by Southern Africa.
Khanyisile Malebe
South Africa’s power story is one of both crisis and innovation. In the late 1990s, South Africa undertook one of the world’s fastest electrification drives, where roughly 2,5 million households were provided access to electricity. When Eskom’s debt burden and rising tariffs collided with surging demand in the early 2000s, the system fell into crisis. By 2007, load shedding had become a national reality, forcing the government and businesses alike to rethink the centralised utility model.
The introduction of IPPs in 2012 was a turning point in South Africa’s energy transformation journey. IPPs eased pressure on Eskom, while proving that decentralised energy could be both viable and scalable. Today, wheeling takes that shift further by allowing commercial institutes to secure power directly from IPPs, reducing dependence on Eskom while accelerating the transition to cleaner energy.
In May 2025, the National Energy Regulator of South Africa established a framework for third-party wheeling that includes rules that standardise how network charges for wheeling are set and collected. By clarifying network charge methodology and access, the rules make wheeling commercially predictable, encouraging more competition and renewable investment.
For commercial institutes – which are generally the continent’s heaviest consumers of electricity – wheeling is more than an energy hedge, and this is perfectly illustrated by Vodacom’s pioneering virtual wheeling deal with SOLA Group. By securing renewable power through a PPA, Vodacom not only reduced its reliance on Eskom, but also set a blueprint for other companies to follow.
Investec’s award of an electricity trading licence by the National Energy Regulator of South Africa also represents a significant milestone in the country’s evolving energy landscape. The bank will be partnering with IPPs and facilitating structured funding, offtake arrangements and wheeling solutions.
The decentralised energy model is also gaining traction beyond South Africa. Kenya’s 2019 Energy Act, reinforced by the 2024 regulations, now enables large consumers to contract directly with IPPs. Eligible commercial institutes consuming more than 1 MVA can soon bypass Kenya Power, opening the door to a competitive open-access energy market. Zambia, Morocco and Egypt are also advancing frameworks that could make wheeling a mainstream option.
The overall benefit of wheeling is significant, with commercial institutes gaining cleaner, reliable power, while IPPs secure bankable off-takers. For investors, particularly in private equity, wheeling creates a pipeline of long-term, creditworthy deals that align with both returns and sustainability mandates.
Wheeling plays a pivotal role in advancing ESG objectives by supporting Africa’s transition to low-carbon, sustainable energy. Its cost-effective nature enables broader, affordable access to clean power, helping reduce emissions while improving energy equity. This model delivers both environmental impact and socio-economic upliftment, creating long-term value for communities and investors. In short, wheeling matters because it transforms Africa’s power challenge into an investment and growth opportunity.
The next frontier for private equity in Africa lies in building regional renewable energy platforms that combine generation, storage and digital innovation. Infrastructure outside South Africa may also be required. These integrated solutions, anchored by bankable corporate off-takers, represent the convergence of infrastructure, finance and technology.
How is Private Equity closing the gap?
Private equity investors are already positioning themselves as catalysts in this space. Their participation typically takes four forms:
-
Platform aggregation: bundling smaller PPAs into investment-grade portfolios that attract institutional capital. One example is Discovery Green, a renewable energy platform that enables electricity wheeling while unlocking access to clean, affordable power at scale.
-
Infrastructure funds: acquiring or building IPPs and backing construction of new renewable projects tied to wheeling agreements.
-
Fintech solutions: enabling smaller commercial institutes to access flexible financing structures, as they may not be able to commit to long-term PPAs.
-
Storage investments: adding batteries and smart control systems to projects, improving reliability and making portfolios bankable.
Each of these approaches strengthens the investment case, aligns with ESG mandates, and builds resilience into Africa’s decentralised power ecosystem.
Risks, mitigants and deal considerations
Although the involvement of private equity investors presents opportunities, investors may face a number of key risks. These risks include tariffs and other regulatory requirements differing across jurisdictions, and technical issues such as congestion and location mismatches, in addition to the usual commercial risks. Battery storage can help to reduce some risks, alongside hedging, which can provide financial protection for price and currency fluctuations.
Wheeling is more than a technical mechanism; it is a bridge between Africa’s power deficit and its investment opportunity. For commercial institutes, it secures cleaner, more reliable supply. For IPPs, it creates direct demand. And for private equity, it offers a scalable play at the intersection of infrastructure, energy transition and corporate finance. As regulators refine frameworks and commercial institutes demand sustainable power, private equity’s role will only deepen.
Sibanyoni and Malebe are Corporate Financiers | PSG Capital
References:
1. https://www.eskom.co.za/heritage/history-in-decades/eskom-2003-2012/
2. https://www.eskom.co.za/distribution/tariffs-and-charges/wheeling/#Why-wheeling
3. https://energy-news-network.com/industry-news/vodacoms-pioneering-virtual-wheeling-solution-goes-live-in-south-africa/?utm
4. https://efficacynews.africa/2025/06/19/africas-power-sector-transforms-as-kenya-zambia-and-south-africa-embrace-open-access-energy-markets/?utm
5. https://empowerafrica.com/africa-by-the-numbers-600-million-africans-still-lack-electricity-2024/
6. https://www.pv-magazine.com/2025/08/11/africas-solar-capacity-surpasses-20-gw/
7. https://www.investec.com/en_za/welcome-to-investec/press/investec-granted-energy-trading-licence-by-nersa.html
8. https://www.discovery.co.za/business/discovery-green
THORTS
The 2025 M&A report: the Africa perspective
Seddik El Fihri
Africa’s M&A market has struggled to maintain momentum in 2025, against a backdrop of global volatility and domestic challenges. Despite a modest recovery from the COVID-19 pandemic shock, deal activity has continued to trend downward. Both deal volume and deal value declined during the first nine months of the year, diverging from the modest rebound seen globally. Limited large-scale transactions, dependence on resource-linked sectors, and cautious foreign investor sentiment have weighed on the market.
Increased caution has translated into subdued activity, rather than a shift toward smaller deals. Africa’s total deal value fell by approximately 24% compared with the same period in 2024, while M&A transactions targeting African companies dropped by nearly 46%. This stands in sharp contrast to a 10% increase in global deal value over the same period, underscoring Africa’s relative underperformance. Deal volume in Africa also continued its downward trajectory, reflecting persistent investor hesitancy.
Seddik El Fihri
However, the picture is far from uniform across the continent, as country-level dynamics matter. Markets showing resilience include Morocco, buoyed by robust private equity activity, and Egypt, benefiting from recent regulatory reforms and large deals, such as the MaxAB–Wasoko merger. Amid the diversity, selective opportunities exist in areas where structural reforms, local investor engagement or sector-specific momentum provide support.
Several sectors led activity involving large deals in Africa:
-
Resource-linked industries dominated transactions, continuing the pattern seen in 2024. So far in 2025, the largest deal with African involvement was Gold Fields’ acquisition of Australian Gold Road Resources for US$1,8 billion, a rare large African outbound deal. The second largest transaction was another mining-related deal, Harmony Gold Mining’s acquisition of MAC Copper for $1 billion. Other notable recent examples include Gold Fields’ $1,4 billion acquisition of Osisko Mining, Zijin Mining’s $1 billion purchase of Newmont Golden Ridge (the owner of the Akyem Gold Mine project) in Ghana, and Huaxin Cement’s $838 million takeover of Lafarge Africa. These transactions underscore Africa’s continued reliance on mining and construction as main sources of deal activity.
-
Energy was another cornerstone of African M&A, as transactions involving hydrocarbon players dominated large-scale activity. This year, Gabon Oil Company acquired Tullow Oil Gabon from Tullow Oil for $300 million. Other recent standout deals include Renaissance SPV’s $2,4 billion acquisition of Shell Petroleum Development Company of Nigeria (announced in 2024) and Carlyle’s intended $945 million purchase of Energean’s Egyptian, Italian and Croatian portfolio, which was recently cancelled after failing to clear regulatory approvals in the agreed time. These deals reflect both brownfield consolidation and private equity firms’ appetite for cash-generating upstream assets. Investors have also been moving selectively.
-
Telecommunications and media continued to attract significant investor interest, reflecting Africa’s rapid digital adoption. Infrastructure-related telecom deals – including mast and tower carve-outs – continue to draw attention, evidence of the sector’s role as a gateway to Africa’s growing consumer and digital economy. A notable deal in 2025 was Newday Group’s acquisition of Swiftnet’s towers business for $371 million. This followed Vivendi’s $1,8 billion bid in 2024 for MultiChoice Group, a South African pay-tv and streaming leader, underscoring the strategic value of Africa’s media platforms and the broader opportunity in digital connectivity.
Private capital has played a selective but quite visible role in 2024 and 2025. This year, for instance, Development Partners International acquired a majority stake in Compagnie de Produits Chimiques du Maroc, a Casablanca-based manufacturer of agricultural chemicals, from ABC Holding for $110 million. Hennessy Capital’s $530 million investment in Namib Minerals in 2024 reflected the international appetite for Africa’s resources, while Investec’s $447 million acquisition of TalkMed Group signalled interest in scalable health care platforms. These transactions suggest that, even amid a broader downturn in deal volume, Africa continues to attract international private capital in sectors where fundamentals align with long-term growth themes.
We anticipate that African sovereign funds will increasingly drive M&A activity by catalysing investment and partnering with international investors. Morocco’s sovereign fund, for instance, attracted more international private capital in the first nine months of 2025 than in the previous two decades combined.
BCG’s M&A Sentiment Index points to the technology and energy sectors as drivers of momentum for the rest of the year, aligning with Africa’s structural strengths in renewables, digital adoption, and energy transition investments. The continent’s startup and fintech ecosystem continues to expand, supported by rising digital penetration and growing investor interest in scalable tech-driven business models. Even so, sentiment in Africa has been volatile, reflecting macroeconomic uncertainty, interest rate pressures, and inconsistent confidence levels across industries.
The medium-term outlook remains cautiously positive. Structural drivers – such as Africa’s demographic growth, rapid urbanisation and accelerating digital adoption – continue to underpin investor interest. Additionally, energy transition dynamics should sustain activity in renewables, mining, and adjacent infrastructure. Moreover, if macro and policy uncertainties ease, Africa will benefit from the ample levels of private capital available globally into renewables, highlighting Africa’s dual role in supplying conventional energy while positioning itself as a critical player in the global energy transition.
Against this backdrop, we expect dealmakers to adopt a selectively opportunistic stance: focusing on future-ready businesses, particularly in technology, energy and financial services, while carefully managing geopolitical and market risks.
Africa’s 2025 M&A story is one of contrasts: declining deal values and volumes, yet sectoral resilience in materials and pockets of growth potential in energy, telecommunications and media. For investors with long-term horizons, Africa remains a market of opportunity, albeit one requiring careful navigation.
The author is grateful to Ouassima El Bouri of BCG’s Transaction Centre for her valuable insights and support in the preparation of this article.
El Fihri is Managing Director & Partner | BCG in Casablanca