Advertisement
Adverstisement

We tracked over 26 African tech acquisitions in 2023

As of November, we tracked about 26 acquisitions in the African tech ecosystem, with the fintech sector representing the highest number of deals in 2023.

We tracked over 26 African tech acquisitions in 2023
Fairmoney x CrowdForce

Amidst a slowdown in funding, African startups are turning to mergers and acquisitions as a means of sustaining themselves. In August, an ex-tech founder on the continent told Bendada.com; "If we didn't sell at the time, we would have closed shop. We had run out of resources and we were unable to raise funding. Getting an acquisition offer at that time, was a miracle."

Per BD Funding Tracker, the number of acquisitions in the African tech ecosystem has tripled since our last report at the end of the first quarter. Nevertheless, the current count as of today (November 30), which is 26, falls short of the 40 deals recorded by The Big Deal last year.

Based on our data, the fintech sector has seen the highest number of deals this year, followed by mobility, Web3 and crypto, and e-commerce. Other sectors involved in acquisition deals include artificial intelligence, gaming, healthtech, cleantech, identity, insurtech, proptech, and communications.

Nigeria stands out as the primary market for most of these deals, recording nine acquisitions, followed by South Africa with four, and Egypt and Kenya each reporting three. Acquisitions also took place in Uganda, Benin, Ghana and Tunisia.

Except for two out of the three recorded deals in Tunisia—the acquisition of InstaDeep by BioNTech and Galactech by GBarena—the value of most of the other transactions was undisclosed.

In the context of an emerging tech ecosystem, like Nigeria and the rest of Africa, Ngozi Dozie, co-founder of Carbon, expresses the view that keeping M&A deals confidential is “not exactly inspiring to the next generation of founders”. “This is not just an African problem but it is particularly pertinent because there are not many wildly successful counterexamples. In over a decade, I have only seen one deal, Stripe acquiring Paystack, celebrated with fanfare,” he added.

Oftentimes, startups view the nondisclosure of M&A deal values as a strategic decision to protect their competitive position, negotiation leverage, and sensitive information, while also managing market perceptions and complying with regulatory requirements.

A compilation of African tech startup acquisitions in 2023

As of November 30, the African tech ecosystem has recorded about 26 acquisition deals, according to BD Funding Tracker.

Coincidentally, the first, second, and third quarters of this year each saw seven acquisitions. Now, with one month left in the fourth quarter, about five deals have been recorded, indicating a likelihood that the final count will exceed seven by the end of the remaining month.

The table below provides you with the details about the acquisitions that have been recorded this year.

💡
$0 means that the deal was undisclosed.

Payday x Moniepoint: A failed acquisition?

In March, just a few days after backing Payday, a Rwandan fintech startup, in a $3 million seed round, Nigerian neobank Moniepoint faced rumours suggesting plans for the acquisition of Payday in a cash and equity deal valued at under $40 million. However, Moniepoint swiftly refuted the speculation, and Payday opted not to comment on the matter.

In a previous analysis, we listed five possible reasons for both parties choosing to maintain confidentiality for the time being. These reasons encompass concerns about competition and market impact, regulatory and compliance issues, internal conflicts, trust issues, potential reputational damage, and the risk of business disruption.

However, seven months have passed since the rumours surfaced, and it appears that even if there was an underground conversation regarding a potential Moniepoint acquisition of Payday, both entities have since moved on.

Why do we think so? In August, the Competition Authority of Kenya approved Moniepoint's request to acquire 100% of the shares in the Kenyan fintech startup, Kopo Kopo. The following month, TechCabal reported that PayDay was considering selling the company to a different buyer.

Neither of the deals has been officially confirmed in the public domain.

Get weekly insights on tech startups and VC in Africa



Join Us On Telegram