JOHANNESBURG - Naspers' spin-off of its pay TV unit MultiChoice changed the complexion of mergers and acquisitions (M&A) in the first quarter of 2019, helping to turn around a 12percent decline to a 71percent increase, financial analysis think-tank Refinitiv said in its sub-Saharan Africa Investment Banking Review for the period.
Refinitiv, formerly Thomson Reuters’ Financial and Risk business, which is one of the world's largest providers of financial markets data, said deals involving a sub-Saharan African target increased 71percent in value to $6billion (R84.90bn), driven by Naspers’ $5.1bn spin-off of MultiChoice.
South Africa's overseas acquisitions accounted for 57percent of sub-Saharan African outbound M&A activity, while acquisitions by companies with headquarters in Mauritius accounted for 43percent.
But an analyst, who declined to be named, said the Naspers merger was a once-off transaction, which did not establish a trend, and that sentiment was still subdued mainly because of uncertainty and perceived risks in emerging markets.
“The Federal Reserve policy of a tighter monetary policy and a contraction in global liquidity were also factors impacting on the slowdown in the M&A activities in sub-Saharan Africa. Naspers was an inevitable deal if you like, but there are not likely to be anymore on that scale,” he said.