Recap 2021: African deal activity, people moves and most-read stories

Africa is signing off from a milestone year when its tech startups broke through the geographic glass ceiling with marquee global venture capital investors making maiden bets in the continent, its top private equity firms eyeing billion-dollar funds and a few industry veterans switching caps.

Broadly, the continent saw private investments—private equity and venture capital—worth an estimated $9 billion through the year, data compiled by The Capital Quest shows. While VC firms and the newly minted unicorns dominated headlines, PE investments comprised nearly two-thirds of the total sum. (Watch out for our data-packed reports starting next week as you slowly get back from year-end holidays).

A part of this momentum was due to the global flush of liquidity that has led to record funding activity across emerging markets despite the raging Covid-19 pandemic. With the US Federal Reserve going ahead next year with a tapering of its bond buying programme that had led to the global liquidity overflow, some of this will slow.

However, with Africa-focused PE-VC funds announcing fundraising milestones cumulating to over $4 billion of capital this year, the private investment juggernaut is not likely to come to a standstill anytime soon in Africa.

If that was not enough, the continent was the focus of several big-ticket merger and acquisition deals in the logistics, telecom and mining sectors, to name a few. The biggest of them was announced at the fag end of the year when MSC offered to buy Bollore’s African logistics unit for $6.4 billion. Overall, the continent reported M&A transactions worth over $22 billion this year.

On the flip side, capital markets activity remained muted outside a few bright spots. The stock indices of South Africa, Nigeria, Egypt and Kenya rose 5-20% in 2021 led by the JSE All Share index, which gained by nearly a fifth.

Dealmakers

Looking at the people behind the investment firms, 2021 saw a bunch of veterans changing firms and many others getting elevated to partnership levels.

The biggest movements were from Emerging Capital Partners (ECP). Africa50, a pan-African infrastructure investment platform, hired veteran PE executive Vincent Le Guennou, co-CEO of ECP, to raise $500 million for investments across the continent. ECP also lost partners Bryce Fort and Paul Maasdorp to Carlyle spinout Alterra Capital, which is launching a new African investment vehicle.

Ata Capital got a new CEO in Mamedupi Matsipa as founder Lelo Rantloane stepped down. Several others got new partners. These included Phatisa, SPE Capital, Amethis, Mediterrania, Apax Global Impact, Altica, Apis, Amethis and Algebra Ventures.

Development financial institutions CDC Group Plc, International Finance Corporation and the European Bank for Reconstruction and Development, too, appointed several new country and regional heads in the continent.

CQ First

The Capital Quest exclusively reported several of the continent’s PE deals and fundraising from LPs, besides a few VC transactions, weeks and months before they were formally announced. In fact, several are yet to be made public.

These include the biggest PE fund being raised for Africa (no, we are not talking about DPI’s latest fund) and many PE transactions by Helios, RMB Ventures, Sanlam PE, Actis, CDG Capital, AfricInvest, Kuramo, Ascent, CVC Capital, Athena Capital, Adenia, Rockwood, Revego, Old Mutual PE, Stanlib and CDC.

On the venture investment side, we broke impending transactions for Uber’s fleet manager Moove, Yoco and Brimore, among others. Notably, Moove’s large ongoing debt and equity fundraise was the most read news report.

We also told you about M&A transactions involving GEMS Africa even as doubt remains over exiting shareholder CDC meeting impact goals, DPI-backed Dolidol’s Nigeria expansion and African poultry major Country Bird.

Other news developments that recorded higher-than-average eyeballs on The Capital Quest included South Africa’s Knife Capital getting a key LP for its new mid-stage VC fund, Namibian PE firm Eos Capital striking a hospitality deal, Temasek-Oppenheimer Africa PE JV backing a liquor maker and Wapi Pay co-founders stepping down after a Japanese VC backed out over an alleged assault incident.

Watch out for more

Well, this is not all. Over the next few weeks, we will slice the proprietary data for alternative investments compiled by The Capital Quest to bring to you a detailed picture of the most active PE investors, a snapshot of VC deals by stages, country-specific deal activity within the continent (not just the big four: South Africa, Nigeria, Egypt and Kenya!), sectoral funding stacks and more.

Most of these data-powered copies would be accessible only to our premium subscribers (you can join CQ Premium here).

We thank all those who read The Capital Quest, and especially those who have subscribed to our premium content, to get a more comprehensive picture of the alternative investment landscape across the emerging market economies of Africa, South Asia and West Asia.

As we enter 2022, here’s wishing all our readers a happy—and healthy—new year.