New data released by the African Private Equity and Venture Capital Association (AVCA) reveals 2014 saw the second highest total value of private equity (PE) deals in Africa on record, at a total value of US$8.1 million.
Comprising data covering the period between 2007 and 2014, the AVCA African Private Equity Data Tracker reveals 983 PE transactions took place in Africa during this time, at a total value of US$34.5 billion.
The highest value of transactions was recorded in 2007, with US$8.3 million worth of transactions concluded. The second highest year came in 2014, with PE transactions to a total value of US$8.1 million.
The data also reveals African PE funds raised US$22 billion between 2007 and 2014.
AVCA recorded a regional shift in PE activity in Africa over the course of the eight year period.
During the first half of the period, between 2007 and 2010, South Africa experienced the highest share of PE transactions, at 28 per cent of the African total. However, in the second half of the period in question, between 2011 and 2014, this figure dropped to 24 per cent; in favour of West Africa.
Whereas West Africa accounted for only 22 per cent of the PE activity in the 2007 to 2010 bracket, this rose to 25 per cent in the second period.
East Africa saw its percentage of African PE transactions increase, from 13 per cent between 2007 and 2010, to 18 per cent between 2011 and 2014; while in North Africa the trend was reversed, with the region accounting for 17 per cent of transactions in the period to 2010, dropping to 14 per cent in the later years.
Central Africa saw the lowest PE activity, with only 3 per cent of transactions between 2007 and 2010, rising to 5 per cent in the 2011/2014 period.
On an industry specific breakdown, the financial sector dominated PE interest with 17 per cent of transactions concluded through the eight years, accounting for 12 per cent of the total value of transactions; followed by the consumer discretionary and industrial sectors.
The IT sector accounted for only 5 per cent of transactions, and value wise amounting to only 1 per cent of the total value of deals.
While only 5 per cent of transactions took place in the telecommunications sector, the value of telecoms PE transactions was the highest across industry sectors, accounting for 25 per cent of the value of all transactions between 2007 and 2014.
Disrupt Africa reported recently AVCA is set to host its twelfth annual conference in London, United Kingdom, in April, bringing together stakeholders to discuss the year’s most pertinent issues and opportunities in Africa.