African deal gains momentum, however, major obstacles remain

Posted on February 25th, 2016
Entrepreneurs
Today's top entrepreneurship and business stories (25 February)
blue Africa map in origami style

Despite political turmoil in many countries, a prolonged downturn in the commodities cycle and related currency risk, Africa’s top economies have maintained investor interest with strong momentum in mergers and acqusitions (M&A) across the majority of sectors. This is one of the key findings of the fourth edition of “Deal Drivers Africa”, published by Mergermarket in collaboration with Control Risks, a business risk consultancy.

Other key findings are that 290 deals were recorded in 2015 – the highest volume since 2007. South Africa, Nigeria and Kenya are seen as the most attractive target countries for M&A activity on the continent and energy, mining and utilities are expected to generate the most M&A activity in Africa (79%), with industrial and chemicals being viewed as the second busiest sector in the next 12 months (72%).

The research, however, found that regulatory uncertainty, particularly compliance and integrity issues, are highlighted as the principal obstacle to M&A activity in Africa (86%), followed by operational and security risks (77%). Cyber security is given highest importance by 60% of respondents when doing an M&A deal in Africa.

Investors looking abroad for property investments
Offshore property stocks have had a strong run over the past year and continue to stake their dominance in SA’s listed property sector. With South Africa’s real estate total return is expected to barely beat inflation this year, fund managers are investing in real estate firms on offshore exchanges or buying into South African-listed firms that own properties abroad or have a dual listing.

Many companies are listed in SA and abroad. Often these companies operate in SA and in one or two other countries.

Stanlib’s head of listed property funds, Keillen Ndlovu, says right now SA is not as attractive as other markets are. He says investors can buy directly into companies in the US, UK and Australia. Other parts of Europe are also highly attractive according to Ndlovu. (SA Commercial Prop News)

Uber introduces first motorbike service 
​Uber has launched a motorbike service in Thailand, marking the first time that the company has offered rides on two-wheeled vehicles. The service, called UberMOTO, launches today as a pilot program in Bangkok. In a press release announcing the pilot, Uber said the new service is aimed at cities in emerging markets where traffic congestion is particularly severe.

For Bangkok users, UberMOTO will be available as another option on the Uber app, and it operates just like its traditional car services. Each motorcycle driver will have to pass the same background checks as car chauffeurs, and will be obliged to provide helmets for their passengers. (The Verge)