Merger and acquisition (M&A) activity across African startups surged to a record high in 2025, with 67 deals completed, representing a 72% increase from the 39 transactions recorded in 2024.
This is according to the State of Tech in Africa (SOTIA) 2025 report published by TechCabal, which highlights a growing shift toward consolidation as Africa’s tech ecosystem matures.
Funding Slows, Consolidation Accelerates
The report noted that African startups raised $3.4 billion in 2025, bringing total funding over the past seven years to $20.16 billion. As venture funding remains selective, established companies are increasingly turning to acquisitions to scale operations, secure licenses, and expand market share.
“This surge signals a definitive shift from a fragmented ecosystem to one defined by strategic consolidation and the emergence of deeper, more integrated platform businesses,” the report stated.
Strategic Acquisitions Dominate 2025
According to Lexi Novitske, Partner at Norrsken22, most M&A transactions in 2025 were driven by strategy rather than distress.
While some exits occurred due to startups struggling to raise capital, scale operations, or resolve licensing challenges, Novitske said the majority of deals reflected deliberate expansion moves.
“We have seen more traditional players, including banks, acquiring technology companies, alongside broader consolidation across the ecosystem,” she said.
“Some acquisitions were aimed at geographic expansion, while others were technology-led deals to add new product capabilities.”
Fintech Leads M&A Activity
Fintech dominated Africa’s M&A landscape in 2025, accounting for 31 deals, or nearly 46% of total transactions. Companies such as Moniepoint, Stitch, and Rank executed multiple acquisitions to strengthen banking licenses, expand infrastructure, and deepen service offerings.
E-commerce, Logistics, and Other Sectors Follow
Beyond fintech, e-commerce recorded eight deals, while logistics and transport saw six transactions, reflecting consolidation in supply chains and delivery networks.
Notable transactions included:
- Twiga Foods is acquiring distributors Raisons, Sojpar, and Jumra to reinforce its supply chain
- Chowdeck acquiring Mira
- Global Shop Group is purchasing Anka to expand its delivery infrastructure
Cross-border acquisitions also increased, with Logidoo acquiring Kamtar, highlighting a push for regional dominance beyond domestic markets.
Telecom, Healthcare, and Deeptech Gain Momentum
The telecom, media, and entertainment sector recorded six deals, including AXIAN Telecom’s acquisition of Wananchi Group and a strategic stake in Jumia.
Healthcare also saw six transactions, while deeptech recorded four deals, underscoring growing maturity in more complex technology segments. Notable deals included HearX acquiring Eargo and Adapt IT purchasing ResRequest.
Climate tech recorded three deals, while edtech, proptech, and services each recorded one transaction, showing that consolidation is expanding beyond traditional fintech and commerce sectors into emerging niches.
Tier 1 Markets Drive Deal Activity
According to the SOTIA report, Tier 1 markets accounted for 75% of all acquired startups in 2025, reinforcing their role as Africa’s primary hubs for liquidity and value creation.
- South Africa led with 16 acquisitions, including exits involving Bank Zero, TaxTim, and Namola
- Kenya followed with 14 deals, including transactions linked to Mobius Motors
- Egypt recorded 11 acquisitions
- Nigeria remained strong with nine deals, including Fatura and Pensions Alliance Limited
African Tech Goes Global
African technology assets also expanded globally, with acquisitions recorded across multiple international markets, including:
- United Kingdom (2 deals)
- United States (2 deals)
- United Arab Emirates, Senegal, Netherlands, Morocco, Mauritania, Ireland, Brazil, and Uganda (one deal each)
This geographic spread reflects growing cross-border integration and increasing global interest in African technology companies.
Outlook for 2026
Looking ahead to 2026, Novitske expects M&A activity to remain strong in Africa’s major tech markets, particularly in fintech and microfinance, where competition remains intense and user bases and data assets are highly valuable.
She added that AI-focused startups, even those not yet commercially viable, are likely to become attractive acquisition targets as efficiency-enhancing add-ons.
However, Novitske cautioned that global market volatility may limit international acquisitions, with many foreign buyers expected to focus on risk management rather than aggressive expansion in Africa.
