Finance

Covid-19: Africa’s private equity sector at risk of a slowdown

Covid-19: Africa’s private equity sector at risk of a slowdown
Friday, 27 March 2020 15:24

Private equity firms present or operating in Africa face the risk of a slowdown due to the current coronavirus pandemic. Many companies that partner with private equity funds are also exposed to the negative consequences of the lockdown measures taken by several countries in the region to deal with the pandemic.

In South Africa, the Central Bank plans a quantitative easing strategy that will involve buying bonds to bring balance in the financial sector, especially the banking sector. For the time being, the arrangements for supporting investments by private equity firms and funds are not clearly defined.

According to data provided by the Crunchbase database, a total of $1.24 billion was raised over the first quarter this year from private equity firms. This is the lowest level for the period since 2016.

Since the companies benefiting from private equity investments are also likely to perform poorly, the South African Private Equity Association calls on sector players to support these companies. According to relevant data collected by the Ecofin Agency, 172 investment funds focusing on Africa are active in the region.

In addition to these investment funds, there are also development finance institutions with a stake in the capital of nearly 450 companies or investment funds. Private equity is as important a part of economic financing as the banking sector in Africa. Its evolution in the post-covid-19 years is to be followed.

Idriss Linge

On the same topic
First RMBS listing on BRVM backed by NSIA Banque Côte d’Ivoire CFA10 billion securitization aims to expand housing finance Move seeks to deepen...
Holmarcom to acquire BNP Paribas 67% stake in BMCI Deal pending approvals, expected to close Q4 2026 Move strengthens Holmarcom...
Strategy follows mining corridors and regional trade flows Expansion backed by record profits and pan-African growth plans Kenya's Equity...
WAEMU imposes new loan rate caps from June 1 BCEAO sets 14% for banks, 24% for others Reform aims to protect borrowers, align lending...
Most Read
01

Mediterrania Capital bought Australian Amcor's Moroccan packaging unit Enko Capital took ov...

Two Other African-focused Private Equity Firms to Snap Up assets shed by Global Majors
02

Enko Capital acquires Servair’s fast-food unit in Côte d’Ivoire, including the Burger King franchi...

Enko Capital Buys Burger King Côte d’Ivoire in Servair Restructuring
03

Central bank to release $1 billion in cash to curb black market demand Move aims to ease inf...

Libya Opens Dollar Sales to Ease Pressure on Dinar and Prices
04

From eastern Chad, where measles and meningitis are spreading through overcrowded refugee camps, to ...

Weekly Health Update | Vaccination Gains Advance in Africa; Antimalarial Resistance Threatens Progress
05

Standard Chartered arranges $2.33 billion for Tanzania railway project Funding support...

Tanzania Secures $2.33 Billion in Syndicated Financing for Standard Gauge Railway
Enter your email to receive our newsletter

Ecofin Agency provides daily coverage of nine key African economic sectors: public management, finance, telecoms, agribusiness, mining, energy, transport, communication, and education.
It also designs and manages specialized media, both online and print, for African institutions and publishers.

SALES & ADVERTISING

regie@agenceecofin.com 
Tél: +41 22 301 96 11 
Mob: +41 78 699 13 72


EDITORIAL
redaction@agenceecofin.com

More information
Team
Publisher

ECOFIN AGENCY

Mediamania Sarl
Rue du Léman, 6
1201 Geneva
Switzerland

 

Ecofin Agency is a sector-focused economic news agency, founded in December 2010. Its web platform was launched in June 2011. ©Mediamania.

 
 

Please publish modules in offcanvas position.