South Africa – Gateway for African M&A
By Guy Addison | AC Corporate Transaction Services
Why more African businesses are choosing Joburg over London for their next
deal.
If you want to understand where capital is really moving, don’t follow the headlines. Watch what serious operators are doing.
African businesses are starting to buy into South Africa, not as a side bet, but as a deliberate growth strategy.
For years, the instinct was different. When African companies had capital or ambition, they looked outward. London listings. Dubai holding structures. Offshore acquisitions. Expansion meant leaving the continent.
That made sense at the time. But the maths has changed.
Increasingly, the most attractive opportunities aren’t offshore at all. They’re regional. And South Africa, with all its complexity and noise, is turning out to be one of the most logical places to deploy capital.
The deal market is healthier than most people think
Spend enough time reading the news and you’d assume South Africa is in permanent crisis mode. Yet the transaction data paints a very different picture.
In the first three quarters of 2025 alone, total deal value reached R1.62 trillion . Even stripping out a once-off megadeal, activity still came in at R571.89 billion, comfortably up on the previous two years .
Buyers are choosing quality assets and paying sensible prices.
And interestingly, South African companies themselves are already active across borders, doing dozens of cross-border transactions into the rest of Africa . Capital has been flowing north for years.
What we’re seeing now is the reverse flow gathering momentum. African buyers are coming south.
Why South Africa works for African acquirers
From the outside, this can feel counterintuitive. Why buy into a slower-growth economy when faster growth exists elsewhere on the continent?
Because deals aren’t just about growth. They’re about execution.
Anyone who has done cross-border transactions in Africa knows this. The numbers on the slide deck are the easy part. The hard part is what happens after signing: diligence surprises, regulatory friction, patchy reporting, integration headaches.
Execution risk quietly kills returns.
This is where South Africa stands out.
For all its issues, it has something rare in the region: institutional depth.
Financials tend to be reliable. Contracts are enforceable. Lenders are sophisticated. Advisors are experienced. Management teams are used to governance and reporting.
None of this sounds exciting, but if you’re committing serious capital, it matters enormously.
Deals close more predictably. Integration is smoother. Fewer skeletons appear in the cupboard.
For a board, that certainty is often worth more than a few extra percentage points of growth elsewhere.
There’s another advantage that doesn’t get talked about enough: valuation.
Because local sentiment has been weak for a while, many solid mid-market businesses trade at reasonable multiples. Compared to Europe or the US and even compared to some high-growth African markets, pricing can look surprisingly attractive.
So you’re effectively buying institutional capability at emerging-market prices.
That’s a powerful combination.
Where the smart money is focusing
Not every sector offers the same opportunity. But a few areas stand out.
Logistics and industrial property are obvious ones. Real estate remains the busiest segment, with 97 target deals recorded . But this isn’t about shopping malls. It’s warehouses, distribution centres and cold chain infrastructure. As regional trade grows, owning logistics becomes strategic. It protects margins and improves reliability. For a regional FMCG or e-commerce player, that’s not just property, it’s competitive advantage.
Resources and energy are also active. Mining deal values have risen more than 50% year-on-year . But this isn’t an old-school commodity rush. It’s tied to green energy, critical minerals and specialist engineering capability. Many African resource groups are realising it’s quicker to buy South African technical expertise than to build it themselves.
And then there’s technology. Deal values in TMT are up roughly 30% . South Africa still has the continent’s deepest bench of fintech, software and digital talent. For fast-growing platforms elsewhere, acquiring a local tech business can compress years of hiring into one transaction.
Where buyers stumble
If there’s one consistent mistake, it’s underestimating how structured the South African market is. Some inbound buyers assume it will feel informal. Negotiations over coffee. Loose processes. Founder-style deals. It doesn’t.
From a transaction perspective, South Africa behaves much closer to a developed market.
Sellers are prepared. Data rooms are deep. Private equity is active. Timelines are tight.
Turning up underprepared quickly costs you credibility.
Too many acquirers focus all their energy on price and too little on what happens next. Culture clashes, system mismatches and management exits can undo a “great deal” very quickly.
Most value isn’t won in the negotiation. It’s won in the first 18 months after closing.
Why now feels different
Timing also matters.
Energy supply is improving. Digital infrastructure is strengthening. Private credit has expanded. And many founders are reaching succession points.
That combination means more good businesses are quietly coming to market.
At the same time, African corporates are stronger and better capitalised than they were a decade ago.
When quality assets meet confident buyers, things tend to happen quickly.
These windows don’t stay open for long.
The best assets get taken first.
The bigger picture
There’s also a signalling effect that’s easy to overlook.
Having a credible South African footprint changes how global investors see you. It suggests governance, systems and institutional maturity.
For many African companies, it’s the difference between being seen as a local operator and a continental player.
It’s also why initiatives that reduce friction for inbound trade and transactions — like the SA Trade Desk — are gaining relevance . When entry is easier, capital moves faster.
The bottom line
South Africa offers scale, capability and execution certainty. Many African businesses now have the balance sheets and confidence to acquire those advantages rather than build them slowly.
Put those two facts together and the direction of travel becomes obvious.
The next wave of African dealmaking is likely to be driven less by overseas capital and more by African buyers backing themselves.
If you’re running a business with regional ambition, it’s probably worth asking a straightforward question:
What capability could you buy in South Africa today that would take you five years to build on your own?
The answer might be your next deal.
Guy Addison is Partner at AC Corporate Transaction Services (ACCTS), advising boards and investors on complex transactions across Africa. ACCTS supports inbound and outbound Mergers and Acquisitions, Foreign Direct Investment, and strategic Investment execution.
