South Africa’s first trailblazing summit, The International Commodity Summit 2025 (ICS2025) has set its sight on amplifying the need for new mergers and acquisitions (M&A) in Africa - particularly the mining industry. The summit is scheduled to take place from July 14 - 17, and  aims to provide a platform for investors and stakeholders to engage in meaningful discussions around M&A strategies that are crucial for economic development in South Africa and beyond.

Merger and acquisition activities remain vital in shaping the African trading market landscape, offering a pathway for companies to enhance their competitiveness and expand their reach internationally. According to PwC in South Africa, M&A activity reached US$10 billion between June 2023 and 2024, with 32 deals closed, compared to 24 year-on-year.

PwC’s annual SA Mine report for 2024 confirms that South Africa’s mining sector was involved in deals that amounted to just over $10-billion in the 12 months to the end of June, dwarfing the  1.5-billion US dollars recorded for the previous twelve month period and exceeding the combined total for the previous five years.

The report notes that in total, there were 32 such transactions compared with the 24 recorded in the previous 12 months.

“The South African mining sector has experienced a hive of M&A activity in the past year, driven by factors that have reshaped the industry’s dynamics and outlook,” the report stated.

PwC confirms that it is the quest for copper and other strategic minerals, which ultimately drives broader consolidation and operational synergies, diversification and strategic realignment to create shareholder value which are the main themes emerging from M&A transactions.

Recent research has indicated that the M&A landscape in Africa is expanding, driven by the continent’s rich natural resources and a burgeoning consumer market of over one billion people. In the past year, South Africa led the charge with 57% of all M&A activities in Africa, amounting to a total value of USD 12.2 billion.

Uganda recently emerged as a key player, with significant deals such as Tullow Oil's acquisition of exploration blocks worth USD 2.9 billion. Nigeria is also leading the charge with its mining reform strategy that aims to revitalize its mining industry.

The approval of the Nigerian Minerals & Mining Bill approved in April 2023, and currently under public review, introduces incentives for foreign investors while strengthening local content requirements. The bill still needs to be enacted to become the sector's primary legal framework. These developments signal a growing confidence in African markets and the potential for future investments.

Africa’s major issues are due to currency volatility and exchange controls that complicate M&A transactions, impacting profitability and financial planning. In Nigeria, foreign exchange shortages can delay profit repatriation, requiring hedging strategies or alternative financial solutions.

Zimbabwe’s fluctuating currency presents unique challenges, prompting investors to consider using escrow accounts or offshore financing to mitigate risks. The truth is that Zimbabwe has struggles to manage currency risks and exchange controls which are essential for maintaining financial stability and ensuring the success of projects and transactions in Africa’s mining sector.

South Africa has boasted a solid mining industry for decades but with recent geopolitical conflicts, this sector faces an uncertain future. South Africa’s current geopolitical tension with the United States might frighten investors as a result of its Land Appropriation Act, as it’s policy may lead to continuing geopolitical chaos that may hinder project development and deter foreign investment in the sector; eventually leading to instability in production levels and economic impacts, and may weaken South Africa’s as a key pillar in Africa’s economy.

The ICS2025 summit aims to probe into the complexity of Africa’s mining industry, and create a dynamic discussion that will promote the formation, and stabilisation of M&As.

This debate will feature a panel of industry experts who will address key topics such as valuation principles, the role of technology in M&A, and the financial structures that can optimize deal outcomes.

"Mergers and acquisitions are not just transactions; they are opportunities for growth and innovation," said Vice President of Hibarri, Cherrylee Samson.

“Without new M&As on our continent, we cannot develop South Africa, and Africa, and that means we will never reach our full potential in industries that we had the capability to dominate,” said Samson.

Samson notes that ICS2025 aims to equip participants and attendees with the necessary tools, and knowledge to navigate this complex environment.

With Africa's mining sector being a focal point, the summit will delve into recent high-profile M&A cases, analyzing what can be learned from these transactions. Participants are afforded the opportunity to explore the strategies of vertical integration, linear integration, and total diversification to understand which approaches yield the best results in the current economic climate.

Additionally, the discussion will cover the risks involved in M&A, including currency fluctuations and regulatory challenges that may arise during cross-border transactions.

As ICS2025 approaches, the anticipation builds for a robust exchange of ideas and strategies that will shape the future of mergers and acquisitions in Africa. Stakeholders are encouraged to participate in this essential dialogue, fostering connections that could lead to transformative business ventures.