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DealMakers - 2023 Annual (released February 2024)

Editor's Note

by Marylou Greig

Over the past two decades, South Africa’s merger and acquisition (M&A) activity has all but halved – influenced by various factors, including regulatory changes, concerns over political stability, and local and global economic conditions, all of which have dampened investor confidence and slowed dealmaking momentum. This is, of course, bar the blip in 2021, following the release of the bottleneck caused by the 2020 pandemic.

Marylou e.jpg
Marylou Greig

In 2023, total deal activity by SA-listed companies declined to 315 deals, valued at R575,9bn (2022: 385 deals valued at R734,7bn). Of this total value, R366bn (64%) represents deals by foreign companies with secondary listings on the JSE (pg 8). Delving deeper into the numbers, the value of the 284 deals announced by SA domiciled companies in 2023 (valued at R210bn) represents a 44% decline in value against that of deals in 2022, and this despite the effect on the numbers of a weaker exchange rate in 2023. On a positive note, the number of failed deals dropped to six, against a norm of roughly 24.

 

Of the top 10 largest deals (by value) by a primary listed SA company in 2023 (pg 10), Life Healthcare’s disposal of Alliance Medical group to entities advised by iCON Infrastructure tops the list at R19,7bn. The largest B-BBEE deal by value was Absa’s eKhaya transaction at R11,2bn. Both deals won their respective categories at the ANSARADA DealMakers Awards.
 

The standout theme of the general corporate finance tables was the return of value to shareholders by way of share buy-back programmes (2023 R328,5bn|2022 R266,4bn), special cash distributions (2023 R49,5bn|2022 R83bn) and the secondary listing of companies on A2X (2023 - 61|2022 - 19), providing investors with cost-effective trading of listed shares.

 

As we settle into the rhythm of 2024, the horizon remains pitted with challenges presented by the national elections, persistent economic challenges of sluggish growth, high unemployment, fiscal constraints and governance issues, and questionable foreign policy decisions. Against this backdrop, there will be risk and opportunity for investors, who will likely continue to adopt a cautious approach.

My grateful thanks to the Oval Table members who make up the DealMakers Advisory Board, for their tireless support over the years and for ensuring that DealMakers remains reputable and relevant in this everchanging M&A space, and to the Independent Panel for the unenviable task of choosing the winners of the ANSARADA DealMakers subjective awards. The calibre and diversity of nominations received across the various categories is testament not only to the hard work undertaken by the individuals who make up this industry, but also to the innovative skill set.


Congratulations to the winners of the 2023 league tables. For some, no doubt, it will be a frustrating result.

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