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Banking Sector

Sub Saharan Africa Mergers and Acquisition Transactions Totalled US$ 25.7 Billion in 2020

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Sub Saharan Africa Mergers and Acquisition Transactions Totalled US$ 25.7 Billion in 2020

South Africa – Refinitiv today released the 2020 investment banking analysis for the Sub-Saharan African. According to the report, an estimated US$523.7 million worth of investment banking fees were earned in Sub-Saharan Africa during 2020, down 15% from 2019 and the lowest annual total in six years.

Fee declines were recorded across M&A advisory, debt capital markets underwriting, and syndicated lending.  Advisory fees earned from completed M&A transactions generated US$108.3 million, down 55% year-on-year to the lowest level since 2013.  Debt capital markets underwriting fees declined 13% to US$64.9 million, a four-year low, while syndicated lending fees fell 3% to US$263.0 million. Equity capital markets underwriting fees totalled US$87.5 million, almost three-times the value recorded during 2019.

Fees generated in the energy & power sector account for 26% of total investment banking fees earned in the region during 2020, up from 10% during the same period last year, while the financial and technology sectors account for 17% and 13% respectively.  South Africa generated the most fees in the region, a total of US$279.9 million accounting for 53%, followed by Mozambique with 14%. Boosted by lending fees, Sumitomo Mitsui Financial Group earned the most investment banking fees in the region during 2020, a total of US$57.3 million or an 11% share of the total fee pool.

MERGERS & ACQUISITIONS

The value of announced M&A transactions with any Sub-Saharan African involvement reached US$25.7 billion during 2020, 62% less than the value recorded during 2019 when Naspers’ US$35.9 billion internet assets spin-off boosted merger activity to an all-time high.  The value of deals recorded during 2020 is the lowest annually since 2012.  The number of deals declined 5% from last year to a seven-year low.

The value of deals with a Sub-Saharan African target declined 39% to a sixteen-year low of US$12.5 billion as domestic M&A within the region declined 44% from last year and the combined value of inbound deals reached just US$7.1 billion, the lowest annual total since 2009.

Chemicals company Sasol agreed to sell a US$2.0 billion stake in LyondellBasell in October, the largest deal in the region during 2020.  Boosted by this deal, materials was the most active sector for deal making during 2020, accounting for 23% of Sub-Saharan African target M&A activity, followed by energy & power (19%) and technology (17%).  South Africa was the most targeted nation, followed by Uganda. Outbound M&A reached a three-year high of US$6.0 billion during 2020, 13% more than the value recorded during 2019.  The value was boosted by Angolan state-owned Sonangol’s purchase of PT Ventures from Africatel Holdings for US$1.0 billion and Templar Investments’ US$1.0 billion offer for Jindal Steel’s Oman unit. With advisory work on twenty deals worth a combined U$4.4 billion, JP Morgan holds to the top spot in the financial advisor ranking for deals with any Sub-Saharan African involvement during 2020.

EQUITY CAPITAL MARKETS

Sub-Saharan African equity and equity-related issuance reached US$2.5 billion during 2020, 54% more than the value recorded during the previous year, but lower than every other annual total since 2005.  The number of deals recorded increased 19% from 2019 but was lower than any other yearly tally since 2012.  One initial public offering was recorded during 2020, compared to three in 2019.  Malawian telecoms company, Airtel Malawi, raised US$28.7 million on the Malawi Stock Exchange in February. JP Morgan took first place in the Sub-Saharan African ECM underwriting league table during 2020.

DEBT CAPITAL MARKETS

The African Development Bank raised $3 billion in a “Fight Covid-19” social bond at the end of March to help alleviate the economic and social impact the Coronavirus pandemic will have on livelihoods and economies in the region.  With this deal, and Ghana’s US$3 billion Eurobond in February, Sub-Saharan African debt issuance totalled US$8.9 billion during the first quarter of 2020, the second-highest first quarter DCM total in the region of all-time.  Only US$1.9 billion was raised during the second quarter, the lowest quarterly total in eight years, followed by US$4.0 billion during the third quarter.  Prosus raised US$2.2 billion in December, boosting fourth quarter bond issuance in the region to US$4.3 billion.  The total proceeds raised during 2020 is US$19.0 billion, down 30% from last year and a four-year low.

Deutsche Bank took the top spot in the Sub-Saharan African bond underwriter ranking during 2020 with US$2.6 billion of related proceeds, or a 13% market share.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Banking Sector

Access Bank Completes Acquisition of Cavmont Bank Limited in Zambia

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Access bank

Access Bank Completes Acquisition of Cavmont Bank Limited in Zambia

Access Bank has completed the acquisition of Zambian Cavmont Bank Limited following the fulfillment of key conditions.

Investors King reported in July 2020 that Access Bank Plc wholly-owned subsidiary in Zambia (Access Bank Zambia Limited) Limited was in talks to acquire Cavmont Bank Limited, a subsidiary of Cavmont Capital.

According to a statement issued by the bank and signed by Mr. Sunday Ekwochi, Company Secretary, Access Bank Plc, the merger of Cavmont into Access Bank Zambia will take place before the end of this month.

This, the bank expected to strengthen Access Bank Zambia core metrics. It said, “Access Bank Zambia will emerge as a stronger and well-capitalised banking franchise with improved scale and capacity to deliver sustainable and best-in-class financial services in the Zambian market.”

“Growing our presence in zambia remains a strategic priority for Access Bank and with the conclusion of the proposed merger with Cavmont, the Bank looks forward to realising the synergies from the transaction and achieving further growth of the combined platform to the benefit of all stakeholders.

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Banking Sector

FCMB Appoints Yemisi Edun as Acting Managing Director While Adam Nuru Proceeds on Leave

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Adamu Nuru

FCMB Appoints Yemisi Edun as Acting Managing Director While Adam Nuru Proceeds on Leave

The Management of FCMB Group on Wednesday announced the appointment of Mrs. Yemisi Edun as the acting Managing Director of the financial institution following Mr. Adam Nuru’s compulsory leave.

Mr. Adam Nuru was accused of fathering two kids with a married staff, Moyo Thomas, whose husband, Tunde Thomas died as a result of the said affair.

Also, read FCMB Group MD Links to Death of Tunde Thomas, Husband of Married Staff He Fathered Her Kids

FCMB Group had announced earlier in the week that it had commenced an investigation into the alleged ‘unethical behavior’ of Mr. Adam Nuru as demanded by a petition signed by over 1000 Nigerians following the death of Mr. Tunde Thomas on December 16, 2020.

In a statement signed by Mrs. Olufunmilayo Adedibu, General Counsel, FCMB, the bank said “In line with normal corporate practice, Mrs. Yemisi Edun is Acting as the Managing Director of FCMB in the interim period while Mr. Adam Nuru is on leave.

The bank, therefore, clarified that Mrs. Yemisi Edun has not been appointed as the substantive Managing Director of the bank. The appointment is solely based on the ongoing investigation into what transpired between Mr. Adam Nuru and the Thomas family.

FCMB further stated that “We are aware of several stories circulating across media platforms about our bank’s Managing Director Adam Nuru, a former employee Mrs Moyo Thomas and her deceased husband, Mr Tunde Thomas.

“While this is a personal matter, the tragedy of the death of Mr Tunde Thomas and the allegations of unethical conduct require the bank’s board to conduct a review of what transpired, any violations of our code of ethics and the adequacy of this code of ethics. This is already underway.

“During the period of the review, the Managing Director has volunteered to proceed on leave. This will guarantee the sanctity of the review process.

“We enjoin all our stakeholders to bear with us as we conduct this review and to please respect the various families involved.”

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Banking Sector

Zenith Bank Announces the Death of Director, Professor Oyewusi Ibidapo-Obe

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Zenith Bank

Zenith Bank Announces the Death of Director, Professor Oyewusi Ibidapo-Obe

Professor Oyewusi Ibidapo-Obe OFR, an Independent Non-executive Director of Zenith Bank Plc, has died, according to the bank.

In a regulatory filing by the financial institution, Professor Obe joined Zenith Bank’s board on February 24, 2016.

According to the statement, “He was a distinguished scholar and professor of systems engineering, past vice-chancellor of the University of Lagos and a seasoned public administrator.

“The late Professor Obe joined the board of the bank on February 24, 2016 as an independent non-executive director and has served in various committees of the board where he creditably acquitted himself, bringing a lot of positive insights to board deliberations.

Zenith Bank expressed its condolences and prayed that God grant the family the fortitude to bear the loss.

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