African Markets Record Strong Performance in 2014
Last year, African equity markets recorded their highest level of activity in five years.Last year, African equity markets recorded their highest level of activity in five years.
A new report issued by PwC, “IPO Watch Africa 2014”, analyses not only IPOs but all transactions on African exchanges, as well as international markets’ transactions involving African businesses that took place from 2010 to 2014.
The total amount of capital raised on African equity markets was a strong $11 billion, almost equal to the $11.1 raised in 2012 and 2013.
There were 24 IPOs recorded last year, compared to 20 the previous year and the amount of initial capital raised doubled to $1.7 billion.
"The performance of African markets was strong in 2014, with an increase in equity capital market activity of 40 percent in terms of volume of offers and 100 percent in terms of capital raised when compared with prior year activity”, declared Nicholas Ganz, PwC Africa Capital Markets Leader.
Further offers (FOs) activity also doubled in terms of capital raised to $9.3 billion.
While the Johannesburg stock exchange lost some of its market share in IPOs, accounting for 32 per cent of initial offers compared to 44 per cent in 2013, it is still dominant in terms of FOs. According to Coenraad Richardson, PwC South Africa Capital Markets Partner, the Johannesburg stock exchange accounted for 87 percent of these proceeds in 2014.
The Tunis and Nigerian Stock Exchanges held the second position on the continent in terms of volume and proceeds raised, respectively.
The financial services sector (including real estate) was responsible for 57 per cent of the combined IPO and FO volumes during 2014. Industrial products & services and consumer products were also very active. The share of the resources sector decreased.