Kenya recorded a significant drop in the number of mergers and acquisitions (M&A) deals in 2024, but the total value of those deals went up sharply, showing a shift in strategy by investors who are now focusing on fewer but larger investments.

According to new data from DealMakers Africa, the total number of M&A deals completed in Kenya between January and September 2024 was just 47, a 51 per cent drop compared to the 71 deals recorded in the same period of 2023. Despite this decline in activity, the total value of transactions rose from $407.7 million in 2023 to $523.8 million (about KSh 67.6 billion) in 2024.

One of the most notable deals during this period was the acquisition of a majority stake in Bamburi Cement by Tanzania’s Amsons Group. The company, led by businessman Edha Nahdi, secured 96.4 per cent of the shares in a deal worth KSh 22.7 billion. The group initially targeted full ownership of the cement firm, one of East Africa’s largest producers.

Private equity investments also dropped significantly in Kenya during the same period. Only 25 private equity deals were completed, with a total value of $129.8 million. This is down from 46 deals worth $319.6 million a year earlier. Despite the decline, PE funds were spread across key sectors such as technology, agritech, healthcare, energy, and financial services.

The drop in both M&A and private equity activities reflects broader economic pressures across East Africa. Deal volume across the entire East African region also declined, from 123 deals in 2023 to 77 in 2024, with total value falling from KSh 174.2 billion to KSh 104.5 billion. Kenya still led the region, accounting for 47 of the 77 deals and 64 per cent of total deal value.

Rising interest rates, currency volatility, and tight financing conditions were major reasons behind the reduced deal activity. Analysts say these challenges have made it difficult to finance mid-sized deals, forcing investors to focus on fewer, high-value transactions, especially in sectors like infrastructure, mining, energy, and manufacturing.

In the first quarter of 2025, DealMakers Africa tracked only 75 deals across Africa, with a combined value of $2.17 billion. This was a sharp drop from 125 deals worth $3.7 billion in the first quarter of 2024, showing that the cautious approach among investors is continuing into the new year.

Despite the overall slowdown, Kenya remains a leading destination for mergers and acquisitions in East Africa. Experts say that if Kenya can improve access to finance, stabilise its exchange rate, and create a more predictable regulatory environment, the country could continue to attract big-ticket investment.

Economic experts also believe there are lessons for countries like Nigeria and others in West Africa. They say Kenya’s experience shows that even during tough times, targeted reforms and cross-border dealmaking can still drive capital inflows, especially in sectors such as fintech, agriculture, healthcare, and infrastructure.

If West African countries like Nigeria want to attract more M&A and private equity deals, they need to boost investor confidence by improving governance, financial market transparency, and ease of doing business. Strengthening regional trade frameworks like AfCFTA could also help deepen intra-African investments.