Fund-raising for African private equity funds was slower in the first three quarters of 2016 compared to 2015, but deal-making was stronger, according to EMPEA.
Africa’s private equity firms have been finding great ways to realize value, fuelling and profiting from the continent’s soaring growth, but also helping Africa’s markets become more pan-regional and scoring successes by working closely with management teams to create value at investee companies.
Global institutional investors (“Limited Partners”/LP) have selected Sub-Saharan Africa (SSA) as the most attractive investment region for private equity, according to research from the Emerging Markets Private Equity Association (EMPEA).
Private equity are getting harder in Africa, particularly for mega funds looking for $75m deals, and 57 funds are currently trying to raise $13.1bn causing a “traffic jam”m, say private equity experts.
Government leaders, regulators and decision-makers across Africa recognize the success of private equity in growing companies, creating jobs and developing infrastructure. They are actively considering ways of encouraging flows of capital, both international and domestic, into private equity.
Fund-raising for sub-Saharan African private equity funds was $1.056 billion in January to June 2011, down 5% from $1.11 bn in the first half of 2010.Total fund-raising for emerging markets funds for the first half of 2011 was $22.6 bn, according to EMPEA, more than double the activity of the first half of 2010.
Funds inflows into private equity in sub-Saharan Africa including South Africa (SSA) were $156 million in the first quarter of 2011, according to research by the Emerging Markets Private Equity association. In 2010 fund-raising had soared to $1.49 billion.
Africa is soaring in its attractiveness to global private equity investors. Over the next 2 years, nearly 30% of global LPs plan to expand PE investments in sub-Saharan Africa (including South Africa) and nearly another 10% plan to start investing. This puts Africa is ahead of markets such as Turkey, the Middle East and North Africa region, Russia/CIS, and Central and Eastern Europe.