China and South Africa undertook the most deals on sub-Saharan Africa’s merger and acquisition sector in the first six months of this year, according to a sub-Saharan Africa Investment Banking Analysis report for the first half of 2013 authored by Thomson Reuters.
The actual value of announced merger and acquisition transactions involving regional targets reached $15.8 billion during the six-month period, up 86 percent from the same period in 2012.
This is the best first half in the region since 2010, when the value of transactions was $25bn.
China and South Africa accounted for 64 percent of all deals in the region. The most targeted nation by value for mergers and acquisitions was Mozambique, which accounted for 42 percent of activity due to PetroChina’s $4.2 billion acquisition of ENI East Africa and a $2.5 billion offer for Videocon, the report revealed said.
Thomson Reuters Africa Head, Mr. Keith Nichols, said South Africa was the next most targeted nation with 28 percent of activity. Nigeria followed with 10 percent.
Mr. Nichol’s explained further that “bolstered by the two Mozambican oil and gas deals, energy and power was the most active sector, followed by materials and healthcare.”
Swiss-based bank Credit Suisse was the lead arranger in most of the merger and acquisition transactions.
On sub-Saharan Africa’s equity investment banking services, the report showed that second-quarter fees for the region dropped 64 percent from the first quarter to reach just $35.2 million, marking the slowest quarter for fees in the region since the third quarter of 2003.
Equity capital markets underwriting fees was $38.2 million in the six-month period, up 29 percent from the same period last year.
Fees from debt capital markets underwriting saw the biggest year-on-year decline, falling 74 percent from the first half of last year “to reach just $6.4 million for the slowest first half since 2009”, the firm said.
Standard Bank topped the sub-Saharan African fee league table for the first half of 2013, with a 9 percent cut of the fees. Standard Chartered and Credit Suisse followed in second and third positions.
Furthermore, equity and equity-linked issuance in the region totalled $1.4 billion during the period, down 24 percent from the comparable period last year.
