Dealmaking activity in Africa has stabilized in 2024, marking the end of the downward trend that followed the post-pandemic peak in 2021. Larger-than-usual transactions have driven this stabilization, even as the total volume of deals remains significantly below historical averages.
According to data from Boston Consulting Group, the total value of deals in Africa during the first nine months of 2024 rose by 36% compared to the same period in 2023, far outpacing the global deal value increase of 10%. However, the number of transactions on the continent held steady year over year, while globally, deal volumes declined by 13%. These figures indicate a significant increase in the average size of deals taking place in Africa.
Sector Highlights
Several sectors have stood out with major transactions in 2024, showcasing the diversity and potential of the African market.
Media: One of the year’s most notable deals was the $1.8 billion bid by French media giant Canal+ to acquire MultiChoice Group, a leading South African TV broadcaster. The transaction underscores the growing appetite for media assets in Africa as global players seek to tap into the continent’s expanding audience base.
Energy: Energy continues to be a cornerstone of African mergers and acquisitions. Renaissance’s $2.4 billion acquisition of Shell Petroleum Development Nigeria was a standout transaction, as was Carlyle’s $820 million buyout of Energean’s assets in Egypt and the Mediterranean. Carlyle’s move is part of a broader strategy to establish an integrated gas exploration and production company in the region.
Materials: The materials sector remains robust, with notable deals such as Gold Fields’ $1.3 billion acquisition of Osisko Mining. Beyond mining, Savannah Clinker’s $150 million bid for Kenya’s Bamburi Cement highlights continued activity in building materials.
Country-Specific Performance
“South Africa has emerged as the leader in deal value across Africa in 2024, recording $3.5 billion in transactions, driven primarily by Canal+’s acquisition of MultiChoice Group. Nigeria follows closely with $3.4 billion in deals, while Egypt ranks third with $913 million,” Seddik El Fihri, Managing Director & Partner Boston Consulting Group explained it.
In terms of transaction volume, South Africa leads with 118 deals, far ahead of Morocco (28 deals), Nigeria (25 deals), Egypt (22 deals), and Kenya (18 deals). South Africa also held the top spot in 2023, reflecting its status as the continent’s most active M&A market.
Private Capital’s Role
Private capital has played a pivotal role in shaping African dealmaking this year. Carlyle’s acquisition of Energean’s assets is a sign that major private equity firms are returning to Africa. Meanwhile, Hennessy Capital’s $530 million bid for Zimbabwean Namib Materials underscores the increasing allure of African opportunities for international private investors.
Key Trends Shaping the Market
Looking ahead, several factors are expected to influence the trajectory of African M&A activity:
Demand for Materials Supporting Sustainable Technologies: As the global shift toward sustainable technologies accelerates, demand for rare-earth elements and other critical materials is growing. Africa’s resource-rich nations are likely to see an uptick in dealmaking as companies secure access to these vital resources.
Increased Interest from Non-African and Financial Players: Non-African buyers and financial investors are executing a growing number of transactions involving African targets. Currently, inbound deals account for more than half of all M&A activity on the continent—a sharp increase from previous years when regional players dominated. This trend is partly driven by the rising presence of Chinese investors and heightened interest from private equity firms and sovereign wealth funds.
South Africa’s Growth Potential: South Africa’s macroeconomic outlook has improved following recent election results, boosting investor optimism. Local firms with cash reserves and international investors are increasingly targeting the country. Furthermore, potential lower interest rates and favorable valuations, particularly for distressed companies, are enhancing the attractiveness of the South African market.
Strategic Moves by Local Companies: As African economies grow, local companies are leveraging strategic deals to strengthen value chains and infrastructure. The rising purchasing power of consumers and evolving market demands are driving investments in logistics networks and technological assets.
Cautious Stance Amid Global Uncertainty: Despite the promising trends, slower-than-expected global economic growth may temper enthusiasm for dealmaking. Companies are likely to adopt a more cautious approach, closely monitoring market conditions before committing to significant transactions.
Outlook for African M&A
Africa’s M&A landscape is expected to remain volatile, characterized by sporadic large deals and concentrated activity in the continent’s more advanced economies. However, the region’s growing economies and strategic importance in global supply chains are likely to continue attracting both local and international investors.
“Demand for materials supporting sustainable technologies and the increasing interest from non-African players are creating new opportunities for dealmaking across Africa,” said Seddik El Fihri. “At the same time, South Africa’s improving macroeconomic outlook and the strategic ambitions of local companies will likely support ongoing activity.”
While challenges remain, particularly in navigating economic uncertainty, the opportunities presented by Africa’s resource wealth, growing economies, and improving business environment provide a strong foundation for sustained M&A activity. With private capital increasingly flowing into the continent and international interest on the rise, Africa’s dealmaking prospects look poised for growth in the years ahead.