In contrast to the rest of the world’s sluggish progress, African economies stand out for their high rates of growth and the confidence they inspire.
The 2013 edition of Mergermarket’s Deal Drivers Africa reports a total of 115 deals worth $26,6-billion taking place in the first three quarters of 2013 across Africa.
Robust M&A activity on the continent has been supported by increasing economic diversification among a number of countries, creating untapped investment opportunities in areas such as financial services, TMT and business services.
Seven of the 10 biggest deals of 2013 have been in the energy, mining and utilities sector. The largest of these transactions was China National Petroleum Corporation’s acquisition of a 28,57% stake in Eni East Africa Spa from Eni Spa, with a value of $4,2-billion.
“Chinese interest in the African energy and resources sector has grown apace in recent years, thanks to China’s domestic energy consumption,” notes Kristina Thompson, editorial research analyst at Remark.
Some key findings in the report include:
* The majority of M&A activity remains driven by African acquirers, rather than inbound M&A to the region; since 2006, African acquirers have generally accounted for 50% to 60% of the total deal volume in each year.
* Private equity activity has been slightly muted compared to 2012. In the first three quarters of 2013 there were 16 private equity-related transactions worth $1,2-billion, while in the same period in 2012 there were 26 private equity-related transactions worth $1,8-billion.
* There has been a marked rise in the value of deals originating from the Asia-Pacific region, increasing from a 13% share in deal value in 2006 to reach 56% by 2013.