The value of announced merger and acquisition (M&A) transactions with any sub-Saharan African involvement reached $23.4-billion in the first nine months of 2015 – 12% more than the value registered during the same period in 2014, Thomson Reuters Africa MD Sneha Shah has revealed.

“Sub-Saharan African equity and equity-related issuance totalled $2-billion in the third quarter of 2015 – a 104% increase in value from the second quarter of the year.

“Despite the quarterly increase, sub-Saharan African equity capital markets (ECMs) declined 16% year-on-year to reach $5.4-billion in the first nine months of 2015,” she noted, citing the results of quarterly investment banking analysis for the sub-Saharan Africa region compiled by Thomson Reuters and boutique advisory Freeman Consulting.

Shah also pointed to sub-Saharan African’s debt issuance, which reached $2.7-billion in the third quarter of the year – 23% less than the value raised in the prior quarter and the lowest quarterly total since the first three months of 2014.

Fees from completed M&A transactions increased 49% to $116.6-million in the first nine months, while fees from debt capital markets underwriting increased 20% year-on-year to reach $39.9-million, the analysis found.

Syndicated lending fees fell 22% compared with a year ago to $60.7-million, while ECM underwriting fees declined 16% to $88.8-million, accounting for 29% of the overall sub-Saharan African investment banking fee pool.

Investment banking fees in sub-Saharan African hit $305.9-million in the first nine months of this year.

Banking group Rand Merchant Bank earned the most investment banking fees in the region in the period under review, raising $38.7-million for a 12.6% share of the total fee pool.

The bank also topped the completed M&A fee rankings in the first nine months of the year and took the lead for ECM underwriting fees. Citi and Zenith Bank earned first places for debt capital markets underwriting and syndicated loans fees, respectively.

Outbound M&A activity, meanwhile, slowed 34% compared with the first nine months of 2014 to reach $3.8-billion in the period under review.

South Africa’s overseas acquisitions accounted for 64% of sub-Saharan African outbound M&A activity, while acquisitions from Mauritius and Seychelles companies accounted for 27% and 6%, respectively.

Inbound M&A also saw a decline, down 6% to $5.6-billion, while domestic and inter-regional M&A reached $8.3-billion – up 39% year-on-year and representing the highest total for the first nine months of any year since 2010.

The financial sector was the most active industry, accounting for 18.5% of sub-Saharan African involvement in M&A, while the largest regional deal in the first nine months of the year saw a $1.8-billion offer from oil and gas group Sonangol EP to acquire a 40% ownership interest in crude petroleum and gas producer Kwanza Basin Blocks from Cobalt International Energy.

Shah further noted that five initial public offerings raised $173.8-million and accounted for 3% of the activity in the region in the first nine months of the year, while follow-on offerings and convertibles accounted for 74% and 23%, respectively.

Furniture and household goods manufacturer Steinhoff Finance Holding raised $1.2-billion from a convertible bond offering in July – the largest equity offering in the region so far this year – while Java Capital took first place in the sub-Saharan African ECM ranking, with a 15% market share.

“In terms of debt capital markets performance, the total bond issuance in the region during the first nine months of the year reached $10.3-billion, down 31% over a year ago.

“South Africa was the most active nation, accounting for 49% of activity, followed by the Ivory Coast, with 25%. Deutsche Bank took the top spot in the sub-Saharan African bond ranking during the first nine months of 2015, with an 18% share of the market,” she commented.