Africa mergers & acquisitions record $44 billion in 2010

Some of the biggest deals in 2010 involved corporates outside of Africa. South Africa, the continent's largest economy, and India were the most acquisitive nations in 2010

Mergers and acquisitions activity in sub-Saharan Africa surged to a record $44 billion in 2010, double the value from a year earlier, Thomson Reuters data showed on Wednesday.
Even as deal activity spiked across the fast-growing African continent, total fees reaped by investment banks declined by 15 percent, as stiff competition put pressure on margins.
JP Morgan Chase & Co edged past rival Morgan Stanley to take the top spot for overall investment banking fees, raking in $21.4 million in the region, thanks to participation in Wal-Mart's bid for South Africa's Massmart, as well big equity and debt issuances.
"Africa is becoming much more important for a lot of the global banks. As a consequence, you are seeing increased competition," said Johann Scholtz, banking analyst at Afrifocus Securities in Cape Town.
Major international banks are targeting more deals in Africa, due to expectations of growing trade flows between Asia and the resource-rich continent.
The chief executives of both Citigroup Inc and JP Morgan have recently visited the continent to stress their interest in winning Africa deals.
Big overseas banks are also doing more than just M&A deals in Africa, the data showed.
M&A fees, historically the biggest contributor to total investment banking activity, accounted for just under 50 percent of all fees, the lowest since 2007.
Equity market deals -- such as initial public offerings and share offerings -- accounted for a third of total fees.
LOOKING FOR A FOOTHOLD
Some of the biggest deals in 2010 involved corporates outside of Africa looking to acquire a foothold in the continent.
The biggest M&A deal was Indian telecom Bharti Airtel's $10.7 billion acquisition of the African assets of Kuwait's Zain.
Likewise, Japan's Nippon Telegraph and Telephone paid around $3 billion for South African IT firm Dimension Data, as the fixed-line operator looks for opportunities beyond its shrinking domestic market.
Now home to about a billion people, Africa is expected to see its population double by 2050. Some of its frontier economies boast growth rates of 7 percent or more.
South Africa, the continent's largest economy, and India were the most acquisitive nations in 2010.
South Africa was also the most targeted country, as many overseas firms see it as a gateway into the region.
Major equity market deals included miner African Barrick Gold's nearly $900 million London IPO, while the top debt market issuance was a nearly $2 billion South African sovereign.
As well as leading the pack for overall fees, JP Morgan brought home the most from M&A.
Morgan Stanley won the top spot for equity market fees, while Citigroup was the leader in debt markets. France's BNP Paribas took home the top spot for syndicated loan fees.