SSA M&A transactions down 58% to $ 14.2bn in Q3’23, lowest in 19 years

The value of Mergers & Acquisition (M&A) transactions with Sub-Saharan African (SSA) involvement reached $14.2 billion during the first nine months of 2023, a 58 per cent decline compared to year ago levels and the lowest first nine months total since 2004. The number of Sub-Saharan African deals declined 21 per cent compared to a year ago, a ten-year low.
This is according to the London Stock Exchange Group (LSEG) release yesterday, as contained in the third quarter 2023 investment banking analysis for the Sub-Saharan African.
Deals involving a Sub-Saharan African target totaled $6.2 billion during the first nine months of 2023, down 74 per cent from 2022 levels, dragged down by a 78 per cent decline in Inbound deals involving a non-Sub-Saharan African acquiror. Domestic deals also declined 53 per cent to $1.8 billion.
Sub-Saharan African outbound M&A totaled $1.8 billion, half the value recorded during the same period in 2022 and lower than any first nine-month period total since 2005.
Energy & Power was the most targeted sector in Sub-Saharan African by value during the first nine months of 2023, while the highest number of deals was recorded in the financial sector. South Africa was the most targeted nation, followed by Nigeria and Zimbabwe.
JP Morgan topped the any Sub-Saharan African involvement announced M&A financial advisor league table during the first nine months of 2023.
On investment banking fees, an estimated $423.6 million worth of investment banking fees were generated in Sub-Saharan Africa during the first nine months of 2023, approximately leveling the value recorded during the first nine months of each of the previous two years.
Equity capital markets underwriting fees totaled $10.9 million, a 65 per cent decline compared to year ago levels and the lowest first nine-month total in the region since our records began in 2000.
Debt capital markets underwriting fees declined 14 per cent to a three-year low of $57.8 million, while syndicated lending fees increased 11 per cent to $227.9 million.
Advisory fees earned from completed M&A transactions in the region reached an eight-year high of $127.1 million during the first nine months of 2023, up nine per cent from 2022 levels.
In all, 56 per cent of all Sub-Saharan African fees were generated in South Africa during the first nine months of 2023, followed by Angola (eight per cent) and Nigeria (seven per cent).
Lazard earned the most investment banking fees in the region during the first nine months of 2023, a total of $38.5 million or a nine per cent share of the total fee pool.
In the equity markets, Sub-Saharan African equity and equity-related issuance totalled $300.6 million during the first nine months of 2023, a 70 per cent decline compared to the same period in 2022 and the lowest first nine months total since 1999. Just five new issues were recorded in the region, a low not seen since 2000.
South African retail firm Pepkor Holdings, real estate company CBo Territoria, and mining development company Premier African Minerals were the only companies in the region to raise new equity funds during the first nine months of 2023. No initial public offerings were recorded.
Morgan Stanley and Capitalmind Investec shared first place in the Sub-Saharan African ECM underwriting league table during the first nine months of 2023.
On debt capital markets, Sub-Saharan African debt capital markets activity totaled $7.3 billion during the first nine months of 2023, down 68 per cent compared to year ago levels and the weakest opening nine-months for DCM activity in the region since 2008.
A total of 38 new offerings were brought to market during the first nine months of 2023, a 37 per cent decline compared to a year ago and a four-year low.
Ivory Coast was the most active issuer nation during the first nine months of 2023, accounting for 51 per cent of total bond proceeds, followed by South Africa (31 per cent).
Government & Agency issuers accounted for 51 per cent of proceeds raised during first nine months of 2023, while Financials issuance accounts for 35 per cent.
JP Morgan took the top spot in the Sub-Saharan African bond underwriting league table during the first nine months of 2023, with $1.2 billion of related proceeds, or a 16 per cent market share.

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