Published: July 13, 2011
Mega mining deals drive growth as smaller deals fall away.
The value of mergers and acquisitions targeting South Africa-based companies increased by 4% in the second quarter of 2011, despite a 17% fall in volume.
Figures released by M&A data provider Zephyr show that US$4.6bn was spent across 75 transactions in Africa’s largest economy compared to US$4.5bn in 90 deals during the first three months of the year. The latest figures are down by almost a quarter on the US$6.2bn recorded in Q2 2010.
These latest figures were driven by two transactions worth more than US$1bn, targeting Uranium miner Makhaha Resources and metals miner Metorex. The mining sector represented the top five deals by value, worth some US$3bn, up from US$581mn in Q1 and US$616mn in Q2 2010.
In terms of volume, banking was the best-performing sector with 16 deals recorded, up from nine in Q1 2011.
Dealmakers are still waiting for private equity to return to the market. Only US$11mn was invested in two deals in the second quarter, down on the US$32mn recorded in the previous three months.