East Africa’s private capital markets began 2025 with 13 transactions with a total value of US$38.7 million in disclosed deals, according to the I&M Burbidge’s East Africa Financial Review for January 2025.
- •Kenya maintained its position as the region’s top investment hub, accounting for 10 of the 13 deals announced in January, while Tanzania followed with two deals, and Rwanda recorded a single transaction.
- •Deal activity in the region spread across major sectors, with financial services recording the most transactions with 6 deals.
- •Other sectors including automotive, energy, agribusiness, hospitality, ICT, and manufacturing each accounted for a single transaction.
Mergers & Acquisitions and Venture Capital were the most active investor segments with 4 transactions each, trailed by Private Equity recording 3 entries, DFI recording 2 deals and lastly PE Exit recording a single investment.
According to the report, investment activity in the region is expected to remain dynamic in 2025, supported by persistent structural tailwinds, expanding geographical opportunities, and an increasing demand for innovative and inorganic growth strategies.
“We anticipate that M&A and private equity activity will maintain steady momentum, albeit with extended deal timelines due to the heightened need for comprehensive risk-return evaluations,” I&M Burbidge.
However, Kenya’s macroeconomic and policy landscape is likely to play a defining role, as investors seek to navigate both challenges and opportunities.
Policy uncertainty and economic pressures have also led to sectoral consolidation, with equity capital becoming a key lever for businesses looking to build resilience.
“Investors are likely to place greater emphasis on not only profitability and growth potential but also the long-term sustainability and adaptability of businesses to external shocks. As a result, investment preferences are expected to lean towards impact growth themes, diversified portfolios, and assets with built-in foreign exchange resilience,” I&M Burbidge added.
Notable Kenyan deals included:
- •Village Capital’s US$150,000 investment in women-led startups
- •The Grant Thornton Kenya and Devani Devani merger
- •DOB Equity’s investment in Spouts International
- •Novastar Ventures’ US$3.5 million investment in Sistema Bio
- •Renew Capital’s investment in Sevi
- •Dutch FMO’s US$10 million primary equity investment in I&M Group
- •CFAO Mobility’s acquisition of Tyre Distribution Africa
- •IFC’s US$15 million loan to Royal Apparel EPZ
- •Kapu’s undisclosed pre-Series A funding round led by BlackWood
In the same month, London based PE firm Actis signed an agreement to sell Java House to Alterra Capital and Phatisa Group for an undisclosed amount.
