Nigeria is one of Africa’s most sought after country as deal making on the continent has made the final step to firmly entrench itself into the global marketplace after several years of steadily increasing mergers and acquisition (M&A) activity.
This is one of the key findings of newly published “Deal Drivers Africa”, by Mergermarket in collaboration with Control Risks, the leading business risk consultancy.
These are the key findings:
• South Africa, Nigeria and Kenya are seen as the most attractive target countries for M & A activity on the continent
• 100% of respondents believe that cross-border deal making between African countries will continue to increase
• Respondents expect most foreign buyers of African companies in 2016 to come from Europe (41%), Asia-Pacific (39%) and North America (16%)
• Energy, mining and utilities are expected to generate the most M&A activity in Africa (79%), with industrial & chemicals being viewed as the second busiest sector in the next 12 months (72%)
• Regulatory uncertainty, particularly compliance and integrity issues, are highlighted as the principal obstacle to M&A activity in Africa (86%), followed by operational and security risks (77%)
• Cyber security is given highest importance by 60% of respondents when doing an M&A deal in Africa
Commenting on the findings, Senior Managing Director for Southern Africa at Control Risks, George Nicholls said:
“M&A activity in Africa is currently driven by many factors: Downturns in more established markets make international buyers look out for new targets; capital is more easily available and high-quality targets are offered at very attractive prices. Despite all the enthusiasm over this positive development, major obstacles remain. Regulatory, operational, security and increasingly cyber risks are major risks that should be considered when undertaking M&A activity on the continent.”
Download the full report here: https://www.APO.af/81fCtP.
