Africa’s private capital landscape kicked off 2026 with a jump in deal value, even as overall transaction numbers declined, signaling a change in investor behavior across the region.
According to Stears’ latest Private Capital Activity Report, disclosed deal value climbed to $16.1 billion in the first quarter, while deal count dropped to 172, compared to 188 in the prior quarter and 201 during the same period last year.
Rather than indicating weakness, this pattern suggests investors are prioritizing larger, more strategic investments in key industries.
This shift was particularly evident in Nigeria, where a handful of major deals dominated activity.
The $6.2 billion MTN–IHS transaction and the $4 billion financing for the Dangote Refinery together made up nearly two-thirds of the total disclosed value.
These large-scale deals point to continued investor confidence in infrastructure-focused assets, especially in telecoms and energy—both considered vital to driving growth in Africa’s biggest economy.
The development mirrors broader global trends. With interest rates still elevated in developed markets and investors remaining cautious, capital is increasingly directed toward projects with strong, long-term return potential.
In Africa, infrastructure fits that profile, given persistent demand and significant development gaps.
Beyond the mega deals, the mid-market segment is beginning to show signs of improvement.
Transactions valued between $25 million and $75 million saw a slight increase, indicating that investment activity is gradually picking up beyond large flagship projects after a quieter period in 2024 and 2025.
Egypt stood out in this category, accounting for over half of these mid-sized deals, largely driven by real estate and urban expansion tied to population growth and housing demand.
While traditional investment destinations like Nigeria, Egypt, Kenya, Ghana, and South Africa continue to lead, their dominance is slowly being challenged.
Markets such as Morocco, Zambia, and Uganda are attracting more independent deals, reflecting a gradual broadening of investor focus across the continent.
In Ghana, investment activity remains consistent but is increasingly connected to regional platforms rather than solely local ventures.
This highlights the rising relevance of cross-border business models, especially in fintech, logistics, and decentralized energy, where companies are expanding across multiple African countries.
Financial services remained the most active sector, making up nearly one-third of all deals.
Much of this activity was driven by funding for small and medium-sized enterprises, a segment that continues to face financing gaps despite its crucial role in job creation and economic resilience.
West Africa retained its position as a key hub for this activity, reinforcing its leadership in the fintech space.
At the same time, emerging sectors are beginning to attract attention. Interest in electric mobility is growing, particularly in East Africa, where companies involved in electric vehicles, battery-swapping, and vehicle financing are drawing investor interest.
Early-stage investments are also starting to flow into artificial intelligence ventures, signaling a gradual diversification of Africa’s tech ecosystem beyond its traditional focus on payments.
Mergers and acquisitions accounted for close to a quarter of all transactions, suggesting increasing consolidation within the market.
Telecommunications and industrial sectors led this activity, alongside continued momentum in fintech as larger firms acquire smaller players to scale operations and strengthen capabilities.
Institutional investors, especially development finance institutions, continued to play a pivotal role in sustaining market activity.
Afreximbank emerged as the most active participant during the quarter, engaging in around a dozen deals across energy, transport, and early-stage funding through its accelerator initiatives.
Its role in major transactions like the Dangote Refinery financing, along with investments in logistics and mobility, highlights the importance of multilateral funding in Africa’s capital ecosystem.
Beyond providing capital, these institutions help mitigate risk, making it easier to attract private investment into sectors critical for long-term development.
Overall, the first quarter reflects a market that is transforming rather than declining. Investors are becoming more selective, channeling larger sums into fewer opportunities while gradually re-engaging with mid-sized and emerging sectors.
For Africa, this signals that capital inflows remain strong, but are now more focused, strategic, and aligned with projects capable of driving large-scale economic impact.