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African Capital Markets 2021

African capital market activity lower in 2020

  • 5 IPOs in 2020; $0.6 bn IPO proceeds raised in 2020
  • 50 FOs in 2020; $4.1bn FO proceeds raised in 2020
  • $7.2bn non-local currency corporate debt proceeds raised in 2020

Overall, African equity capital market (ECM) activity in 2020 was the lowest it has been in the last decade, recording a significant decline in both volume and value. The drop in equity markets was largely driven by the impact of the repercussions of the COVID-19 pandemic as well as global and economic uncertainty. Moderate recovery in African markets was noted in the second half of the year with most deals occurring in the last quarter. The slowdown effect of the pandemic was also evident in the volumes and values of non-local corporate, sovereign and supranational debt raised during the year.

These are some of the key findings from PwC’s Africa Capital Markets Watch 2020 publication issued today, which analyses equity and debt capital market transactions on an annual basis. This report covers initial public offerings (IPOs) and further offers (FOs) by African companies, in which capital was raised on Africa’s principal stock markets. The report also includes non-local currency debt transactions by African companies in international markets.

Ashley Schoombee, Director in PwC’s Africa Capital Markets division says:

“While many global markets experienced a brief delay in activity at the onset of the COVID-19 pandemic followed by recoveries before the end of the year, the pause experienced in African capital markets was more prolonged. Some recovery was noted in the second half of the year with the completion of several deals.”

African equity markets

African ECM recorded a significant decline in both value and volume by 2% and 23% respectively, compared to 2019. IPO activity continued a downward trend as observed over the last four years with five IPOs recorded in 2020; the lowest number in the last decade. It is notable that the largest IPO in 2020 by value was the dual listing on the London Stock Exchange and the Johannesburg Stock Exchange of Bytes Technology Group Ltd, a UK business which demerged from South African technology company Altron, raising $467m.

FO value in 2020 increased by 16% compared to that of 2019, but fewer companies accessed the market in 2020 continuing the trend of lower FO volumes over the past few years.

Domestic deals accounted for 71% of ECM volume and value recorded in 2020. Over the past decade, domestic activity accounted for 72% and 78% of ECM volume and value, respectively. There was a significant decline in outbound ECM activity between 2019 and 2020.

African debt markets

African issuers have raised $167bn in non-local currency debt from 536 issuances over the past 5 years. Patterns of corporate non-local currency bond issuances have been somewhat inconsistent over the past five years, due to the small number of active issuers and the variable size of issuances over the period. Total proceeds in 2020 represented a five-year high of $7.2bn.

Egypt has consistently been the largest issuer of sovereign bonds over the past five years, accounting for 38% of all sovereign bonds issued in 2020. Many countries cancelled or postponed their plans to issue bonds in the light of COVID-19 pandemic-related economic and financial uncertainties.

Schoombee concludes:

“A state of uncertainty seems to have become the ‘new normal’ globally, and we can expect some degree of volatility and caution to continue to affect Africa’s capital markets activity in 2021.”


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Sanchia  Temkin

Sanchia Temkin

Senior Manager, Media Relations, PwC South Africa

Tel: +27 (0) 11 797 4470

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