Global law firm Baker McKenzie’s analysis of Refinitiv data shows that mergers and acquisitions (M&A) in Ghana exhibited a solid performance in 2020, despite the slow pace of dealmaking in the first half of the year.
Ghana recorded 10 deals in the second half of 2020 (H2 20), and 14 deals in total for the full year 2020 (FY 20), reflecting a growth of 17% year-on-year. Total deal value soared by 11607% to $818 million and 3369% to $832 million in H2 20 and FY 20, respectively.
Cross-border transactions contributed a huge portion of M&A activity in Ghana, recording a total deal value of $793 million for both H2 2020 (seven deals) and FY20 (nine deals).
The materials sector was the top target for inbound and outbound deals in Ghana in H2 2020 and FY 2020. China was the primary investor in the country, with two inbound deals worth $214 million for both H2 and FY 2020.
For outbound transactions, Australia was the key target with two deals totaling $440 million, and one transaction worth $439 million in H2 and FY 2020, respectively.
China’s acquisition of the Bibiani Gold Mining Project via Chifeng Jilong Gold Mining Co for $109 million was the largest inbound deal in H2 and FY 2020. Conversely, Engineers & Planners Co Ltd’s acquisition of Cardinal Resources Ltd in Australia for $439 million was the top outbound transaction for H2 and FY 2020.
Wildu du Plessis, Head of Africa for Baker McKenzie said: “Ghana, despite some ups and downs, appears to be getting it right in terms of striking the right balance between encouraging investment and protecting the rights of the country and its people.
It has also been singled out as one of the countries that is ready to benefit early on from AfCFTA. This is due to existing favourable conditions in the country, such as having an open economy, good infrastructure, a supportive business environment and the ability to quickly ramp up its intracontinental exports. All this bodes well for Ghana’s future economic position in Africa.”
African Eye Report