Nigeria’s M&A transactions falls 76% amid weak deal activity

The value of mergers and acquisitions (M&A) deals involving Nigerian entities fell sharply in 2025, declining by 76 percent to $1.3 billion, according to a report.

Data from LSEG’s Sub-Saharan Africa Investment Banking Review Full Year 2025 showed that total announced M&A transactions with any sub-Saharan African involvement reached $37.2 billion during the year, representing a marginal 0.8 percent increase compared to 2024.

However, the number of deals announced across the region dropped 13.4 percent to its lowest level since 2005.

“Deals targeting sub-Saharan African companies totalled $18.6 billion, down 24.3 percent year-on-year. While inbound M&A activity rose 54.2 percent to a three-year high, domestic M&A activity declined steeply by 69.3 percent by value,” it said.

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Despite the sharp contraction in deal value, Nigeria still ranked as the fourth most targeted country for M&A activity in the region, highlighting continued investor interest even amid reduced transaction sizes and volumes.

South Africa remained the most targeted country for M&A transactions, followed by Kenya and the Ivory Coast.

Across sub-Saharan Africa, the consumer staples sector dominated deal activity, accounting for 42.8 percent of total target M&A value.

Major transactions included Coca-Cola’s $3.7 billion acquisition of control of its South African bottling operations and Asahi Group’s $2.4 billion purchase of Diageo’s Kenyan spirits business. The Energy & Power sector followed, contributing 21.3 percent of overall deal activity.

Outbound M&A activity from sub-Saharan Africa rose strongly, reaching $8.1 billion in 2025, a 61.6 percent increase year-on-year, supported in part by Gold Fields’ $2.1 billion acquisition of Australia-based Gold Road Resources.

In the advisory rankings, Goldman Sachs announced M&A financial advisers for deals involving the region, capturing a 30.5 percent market share, followed by JP Morgan and Rothschild.

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The report indicated that Nigeria retained its status as one of the core financial hubs in West Africa and remained the second-largest investment banking market in sub-Saharan Africa by fee generation, trailing only South Africa.

Total investment banking fees generated across sub-Saharan Africa reached $503.9 million in 2025, up 13.1 percent from the previous year. South Africa accounted for 51.5 percent of regional fees, followed by Nigeria with 19.4 percent and Ivory Coast with 6.9 percent.

Nigeria’s own fee pool rose to $97.9 million, marking an 8 percent increase from 2023 and reinforcing its position among the region’s top three fee earners.

Equity market shows mixed signals

Although Nigeria recorded weaker equity issuance volumes year-on-year, the region as a whole experienced a surge. Sub-Saharan African equity and equity-related issuance climbed 58 percent to $5.5 billion in 2025, the highest level in eight years.

In Nigeria, equity issuance proceeds totalled $690.9 million, representing a 27 percent decline compared with the previous year.

Nonetheless, Nigerian companies featured prominently among the region’s largest deals. Presco Plc completed a $163.7 million follow-on offering in December, while United Bank for Africa executed two follow-on offerings in April and September, raising more than $255 million combined.