Africa Private Investment Nearly Doubles to $3bn on Mega Deals
Africa’s private capital market hits $3 billion in the second quarter of 2025, with transaction volumes climbing compared to the previous quarter, driven largely by a rebound in mega deals.
According to the Q2 2025 Private Capital in Africa Report by Stears and the East Africa Venture Capital Association (EAVCA), the continent recorded 147 private capital transactions during the quarter, up from 125 in Q1 2025 and 137 in Q2 2024.
The total disclosed transaction value surged to $3.0 billion, almost double the $1.6 billion recorded in Q1 2025, though still below the $3.7 billion reported in the same period last year.
“The rise in transaction value was largely attributed to a rebound in mega deals, transactions exceeding $75 million, which accounted for 11 percent of disclosed deals, up from just 5 percent in Q1 2025.”
“At the same time, the share of micro and small transactions fell from 54 percent to 49 percent, while large deals ($25 million to $75 million) declined from 25 percent to 16 percent,” it said.
The report added that debt financing continued to play a major role in the quarter’s private capital activity. Agriculture and energy led debt-financed transactions, jointly accounting for 40 percent of all debt deals.
“Debt accounted for 85 percent of all agricultural transactions, reflecting the sector’s preference for financing that unlocks working capital and supports growth for agripreneurs.”
Energy projects also relied heavily on debt due to their capital-intensive nature and stable revenue streams. Consumer Goods & Services saw notable debt involvement, with debt featured in 35 percent of its transactions and contributing 26 percent of the total debt deals across the continent, the report said.
In terms of sectoral performance, Consumer Goods & Services overtook Financial Services to become the most active sector in Q2 2025, accounting for 27 percent of all transactions.
Financial Services followed closely at 24 percent, with technology and energy & utilities recording 18 percent and 14 percent, respectively.
“Investment activity remained concentrated, with consumer goods & services and financial services together contributing 52 percent of total deals,” Stears disclosed.
This marks a slight decline from 55 percent in Q1 but remains significantly above the 41 percent recorded in Q4 2024, indicating continued investor interest in familiar sectors.
For mergers and acquisitions activity, financial Services remained the hotspot in Q2. Notable transactions included Access Bank’s $100 million acquisition of National Bank of Kenya and Egypt’s first-ever SPAC merger, which saw Catalyst Partners acquire digital lending platform Qardy through its Catalyst Partners Middle East SPAC.
Central Africa recorded the highest share of debt-based transactions relative to overall deal activity, with 64 percent of transactions in the region involving debt, the report said.
Although Central Africa represented just 7 percent of Africa’s total private capital activity, it accounted for 13 percent of all debt deals, reflecting the region’s focus on energy and commodity investments.
“Debt financing was also significant in East Africa, where it represented 46 percent of transactions and contributed 40 percent of the continent’s debt volume. While equity financing dominated in the remaining regions, structured debt maintained a foothold in Southern and West Africa, where project financing accounted for 15 percent and 13 percent of transactions, respectively,” the research firm said.
Regionally, sectoral trends varied. Consumer goods & services topped transaction volumes in East and Southern Africa, consistent with its overall position across the continent. Meanwhile, financial services led in West, North, and Central Africa, where it shared top billing with energy & utilities.
The report indicates that while capital activity remains concentrated, regional and sectoral nuances continue to shape the flow of investment across Africa.
