Africa’s Mergers and Acquisitions gain momentum during COVID19

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    By Eric M.K OSIAKWAN

    On the 10th of July 2020, Helios Holdings Limited announced a merger with Fairfax Africa Holdings Corporation to form Helios Fairfax Partners Corporation – a pan Africa focused alternative investment manager. On the same day, Eversend, an African fintech startup also announced over a $1M raise through crowdfunding. Prior to that Helios announced a $100M investment from the Commonwealth Development Corporation (CDC) into their fund IV. On the 1st of July 2020, our portfolio company, www.hotelonline.co announced the acquisition of two travel tech companies. On 30th June 2020, www.msfafrica.com announced the acquisition of fellow fintech Beyonic based in Tanzania. On 23rd June, 2020 www.acumen.org announced their exit from KopaGas of Tanzania as part of the $25M acquisition by Circle Gas. Then on 22nd January 2020, www.mypaga.com announced the acquisition of Apposit an Ethiopian software company as the entry strategy into the market. These recent deals have created undeniable momentum in mergers and acquisitions in Africa – with majority in tech — setting an unexpected tone for more positive developments in the second half of 2020 during this COVID crisis.

    Whilst Covid19 has brought unimaginable devastation to the world and stocked racial revolt in America. Which is now spilling over to Europe, in Africa, our fast adaptation to the new normal spared us not only mass casualties and pain, but the lockdowns triggered an unintended consequence of speeding up the digital economy. This resulted in investments in the second quarter like our portfolio company www.zulzi.com closing $2.5M and AMP Global Technologies closing a $2M prior to COVID19 setting the stage for our Africa original content format and series launching this quarter @ www.takebackthemic.com. Then on 24th June 2020, www.ingressive.co closed their maiden $10M seed fund to invest in tech companies across Africa. On the same day, the Africa Venture Capital and Private Equity Association (AVCA) published their VC in Africa report for 2014 to 2019 showing a total of 613 deals totaling $3.9B with 2019 recording $1.4B of those transactions. Majority of those deals happened in South Africa, Kenya, Nigeria, Ghana and Egypt. South Africa, Kenya, Nigeria and Ghana are four of the KINGS countries (excluding Ivory Coast) that I had postulated back in 2013 would be leading the digital economy in Africa. Ivory Coast was

    https://www.globenewswire.com/news-release/2020/07/10/2060633/0/en/Proposed-Strategic-Transaction-Between-Helios-Holdings-Limited-and-Fairfax-Africa-Holdings-Corporation.html

    Ugandan fintech startup Eversend banks over $1m via crowdfunding


    https://www.africaglobalfunds.com/news/investors/cdc-invests-100m-in-helios-investors-iv/?fbclid=IwAR1Fab4mIXzF2sS18tykRwn9NpKOR_6beeHd1Yq_JXUtbZOlxWG9ZCIu7Rk
    https://theexchange.africa/investing/kenyan-travel-tech-hotelonline-on-major-onslaught-of-the-african-market/

    Fintech MFS Africa acquires digital payments provider Beyonic


    https://www.andeglobal.org/blogpost/920159/351036/Acumen-Exits-Kopagas-following-Circle-Gas-Acquisition

    Nigeria’s Paga acquires Apposit, confirms Mexico and Ethiopia expansion

    COVID-19 is SPEEDING up the digital economy in Africa

    Ingressive Capital grows African tech startup fund to $10m


    https://www.avca-africa.org/research-publications/data-reports/

    replaced on the list by Egypt partly because of the civil war of 2011 that ousted incumbent president Gbagbo and set back the country’s development tremendously.

    A lot of these deals were surely in the pipeline before COVID-19 but the fact that they still materialized is a function of resilience and the positive unintended consequence of the lockdowns across the continent. This momentum we are seeing in tech M&A is the result of the Capital, Capacity and Community building that has gone into the s

    Off course some deals did not materialize, and we have seen some funds shut down due to the harsh environment. We have also seen African innovators launch innovations that are tackling the virus head-on and some of them could be big winners in the not too distant future. Some of these entrepreneurs have had to adapt and pivot under unusual conditions to launch these new ventures and also keep their boats sailing. The ingenuity of African entrepreneurs and tech ventures were put to great test under COVID-19 and some like Hotel Online a travel tech venture, which was severely impacted, pivoted towards a new business model. By the end of March, revenues had gone down to 20% and Endre Opdal the CEO was under intense pressure. His first move was to trim down the operations and staff which the board approved. The second step was evaluating the existing business to find the right pivot.

    actor over the years which was accelerated by the COVID-19 lockdowns making online the new normal across Africa.

     

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