The agriculture sector recorded the highest proportion of investor exits across Africa in the first quarter of 2026 (Q1), underscoring shifting dynamics in private capital flows. According to the latest report by African market intelligence firm Stears, nearly 30 per cent of agriculture‑related transactions during the period involved investors pulling out.
At the same time, capital inflows increasingly gravitated toward financial services and infrastructure‑linked investments, reflecting sustained appetite for credit expansion, energy generation, and telecommunications projects.
Overall, private market activity began the year on a subdued note, with 172 transactions captured between January and March. This marked a decline from 188 deals in the previous quarter and 201 in the same period last year. Yet despite fewer deals, disclosed transaction values surged to KSh2.08 trillion, up from $14.1 billion in Q4 2025 and $5.8 billion in Q1 2025. The jump was attributed to larger‑ticket investments in key sectors.
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In Q1 of 2026, financial services accounted for 29 per cent of all deals, followed by industrials, energy and utilities, information technology, and consumer discretionary. Together, these five sectors represented 85 per cent of total activity, highlighting investor confidence in areas tied to infrastructure development and digital services.
Within financial services, lending segments targeting micro, small, and medium enterprises (MSMEs) drove much of the momentum. Infrastructure‑related investments also attracted significant capital, particularly in energy generation and telecommunications, as investors sought to plug persistent infrastructure gaps.
Transaction structures varied across industries. Equity investments dominated most segments, while debt financing was more common in energy and utilities, real estate, and materials. Mergers and acquisitions featured prominently in communication services and industrials. Agriculture, despite leading in exits, recorded fewer debt‑based transactions compared to other sectors.
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The report highlighted a decline in liquidity across the economy, largely driven by reduced participation by international acquirers in exit deals. Analysts noted that foreign buyers often play a decisive role in widening the pool of strategic investors, injecting cash into the market, and helping assets achieve stronger valuations.
With fewer of these players active in the quarter, exit pathways narrowed and became less competitive, signalling a more cautious investment climate at the start of the year.
By Masaki Enock
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