Pricing

African PE Pricing Has Evolved Against Listed Markets 

Africa ex-South Africa

The median EV/EBITDA multiples of listed equity across Africa ex-SA have derated materially over the study period, falling from approximately 8.5x in June 2015 to a cycle low of 4.7x in April 2023, before recovering to 6.4x by June 2025. By contrast, private equity entry multiples trended upward through to 2019 and have since moved with the cycle, ranging from 7.6x in June 2015 to a cycle peak of 9.5x in June 2023. From June 2017 onward, PE multiples exceeded listed-market multiples in every June reporting period except 2018, reversing the conventional liquidity-discount relationship. 

This relationship may seem counterintuitive, given the liquidity discount typically applied to unlisted assets. However, the comparison requires context. Listed markets across sub-Saharan Africa are characterised by low trading volumes, high compliance costs and limited institutional participation. These structural constraints compress public-market valuations independently of fundamental value, so listed multiples do not always provide reliable fair-value anchors. Private equity transactions, by contrast, generally target growth-oriented businesses with stronger forward earnings profiles and include a control premium not reflected in listed prices for minority interests. 

By June 2021, a more conventional relationship briefly re-emerged. The median PE multiple declined from 8.4x in June 2019 to 8.0x in June 2020 and further to 6.6x in June 2021, a cumulative decline of roughly 18% over two years, while the listed series settled at 5.9x in June 2021. The convergence reflected more cautious capital deployment, subdued fundraising, and the broader negative market sentiment of the pandemic-era window. 

The subsequent recovery was abrupt. Private equity multiples rebounded to 7.0x in June 2022 and a cycle peak of 9.5x in June 2023, before moderating to 8.3x in June 2024 and 7.0x in June 2025. Listed equity followed a different path, troughing at 5.2x in June 2023, before recovering to 6.5x in June 2024 and holding at 6.4x in June 2025. The result was a marked widening of the private-to-listed spread: in June 2023 the differential reached approximately 4.3x, the largest annual spread observed across the study period, before narrowing materially as listed prices recovered and PE pricing moderated. By June 2025 the spread had compressed to approximately 0.6x, reflecting simultaneous moderation in private market pricing and a recovery in listed valuations. 

The premium commanded by private equity over listed markets in recent periods also reflects differences in deal composition. Private equity funds in Africa ex-SA are targeting high-conviction businesses in consumer goods, financial services and technology that are often absent or underrepresented on African public exchanges. The PE universe is not a random sample of publicly traded companies, and the observed multiple differentials partly reflect this quality and sector-mix divergence. 

The broader market context supports continued investor engagement with the asset class. According to AVCA, Africa-focused private capital fundraising, spanning private equity, venture capital, infrastructure and private debt, more than doubled from USD 1.9bn in 2023 to USD 4.0bn in 2024, with private equity funds alone accounting for USD 1.2bn of that total (AVCA, 2025). Exit activity increased 47% year-on-year from 43 to 63 transactions, indicating a maturing ecosystem. This followed a contraction in fundraising from USD 2.8bn in 2022 to USD 1.9bn in 2023, underscoring that the recovery, while meaningful, builds on a period of significant market stress. 

South Africa

The median EV/EBITDA multiples of listed equity in South Africa have declined materially over the study period, falling from a peak of approximately 9.9x in late 2014 to 6.6x by June 2025. The derating has been broad-based rather than crisis-driven: the SA listed series printed at 8.7x in mid-2016, 7.1x in mid-2019 and 6.1x in mid-2022, before holding in a 6.3x-6.6x range through 2024 and 2025. This represents cumulative compression of roughly a third in headline multiples across the eleven-year window, reflecting persistent load shedding, weak real GDP growth, sovereign credit rating downgrades and weaker investor confidence in the South African growth story. 

South African PE multiples have, for most of the study period, traded at a discount to listed equity, reflecting the more conventional illiquidity discount applied to private assets. This contrasts with Africa ex-SA, where PE multiples have frequently traded above listed equity for the structural reasons discussed above. The discount has not been uniform across all periods or transaction types: high-quality transactions, particularly in technology and financial services, have at times commanded multiples above prevailing listed comparators. However, the general pattern is that median SA PE multiples have remained range-bound between approximately 4.6x and 7.0x over the past decade, with most mid-market transactions clustering in the mid-single digits. 

The COVID-19 pandemic marked a clear low point in the cycle, with the median SA PE entry multiple falling to approximately 4.6x for the year ended June 2020, the lowest annual reading in the study period. The recovery was gradual but sustained, rising to 5.4x by June 2021, 6.6x in June 2022 and a cycle peak of 7.0x in June 2024, before moderating to 6.5x in June 2025. This represents a return to mid-cycle pricing rather than a re-test of the COVID lows. 

The context behind the more recent recovery is meaningful. The formation of the Government of National Unity in mid-2024, improved sentiment on the JSE, rand strength, lower bond yields and the easing of load shedding all supported a better macro backdrop for listed and private valuations. South Africa remains sub-investment grade across the major rating agencies, but the directional shift in sentiment is notable. 

The most significant valuation development as of June 2025 is the near convergence of PE and listed equity multiples in South Africa. The median SA PE entry multiple stood at 6.5x, compared with a listed equity median of 6.6x, representing a spread of approximately 0.1x in favour of listed equity, against a historical average differential closer to 1.5x to 2.0x. The convergence is more nuanced than a simple narrowing: the chart series shows PE multiples exceeding listed multiples in June 2022 (6.6x vs 6.1x) and June 2024 (7.0x vs 6.3x), so the June 2025 reading represents a partial return to the conventional discount relationship rather than an unprecedented inversion. 

This convergence reflects two simultaneous dynamics: a moderation in PE entry pricing from the 7.0x cycle peak recorded in June 2024, and a stabilisation of JSE valuations in the 6.1x to 6.6x range after the compression seen through 2022 and 2023. Both point to the same implication for deal underwriting: multiple expansion can no longer be assumed and return generation will increasingly depend on operational value creation and earnings growth over the holding period. 

The forward outlook remains uncertain. While the GNU reform agenda, easing interest rates and the resolution of load shedding as a near-term structural drag have improved the macro foundation, growth remains weak and coalition fragility continues to temper confidence. For PE investors, South Africa presents genuine green shoots, but a sustained rerating of entry multiples requires reform delivery to translate into earnings growth; reform intent alone is not enough to sustain sentiment.

PE Pricing Distribution 

South Africa 

The distribution of South African private equity entry multiples has changed across the three periods shown in the accompanying graph, which displays the number of transactions by EV/EBITDA price band. The data indicates a shift from a higher-multiple pre-COVID period to valuation compression, followed by a modest recovery in the most recent cycle. 

Between July 2016 and June 2019, the South African deal population was broadly distributed across the valuation spectrum. Approximately 40% of transactions were priced above 7x EV/EBITDA, while the 3.5x to 7x band accounted for an additional 50% of deals. The sub-3.5x segment remained minimal at under 10%. This distribution corresponds to a period of relative macroeconomic stability, during which even smaller or founder-exit transactions could achieve mid-range valuation multiples. 

From July 2019 to June 2022, the upper end of the valuation distribution contracted significantly. Transactions above 7x declined to approximately 22% of the total, while the 3.5x to 7x band expanded to nearly 70%. The onset of COVID-19 reduced South African PE median multiples to a cycle low of 4.6x in June 2020, followed by a partial recovery to 5.4x in June 2021 and 6.6x in June 2022. The contraction in the premium band likely reflects both earnings pressure in specific sectors and increased buyer discipline amid heightened uncertainty. 

During the most recent period, July 2022 to June 2025, the distribution stabilised rather than rerated. The 3.5x to 7x band remained at approximately 69%, the above-7x proportion increased slightly to around 23%, and the sub-3.5x segment contracted further to 8%. Most South African PE transactions are now priced between 3.5x and 7x, with limited evidence of a broad return to pre-COVID valuation levels.

Africa ex-South Africa 

The pricing distribution for Africa excluding South Africa presents a structurally different pattern, with a persistent concentration of transactions above 7x EV/EBITDA. This reflects the growth-oriented and higher-multiple nature of markets outside South Africa. 

Between July 2016 and June 2019, 75% of transactions in Africa excluding South Africa were priced above 7x EV/EBITDA, with 19% in the 3.5x to 7x band and 6% below 3.5x. This concentration of high multiples reflects the deal composition of the period. Transactions in financials, consumer staples, and technology sectors across East and West Africa typically attracted growth premiums, as buyers prioritised earnings expansion potential over current yield. 

From July 2019 to June 2022, the upper valuation band compressed significantly, with transactions above 7x declining from 75% to approximately 51%. The mid-range expanded from 19% to 33%, while the sub-3.5x segment increased from 6% to 15%. COVID stress and risks that affected South African valuations intensified in several ex-South African markets due to currency depreciation, sovereign debt stress, and reduced cross-border deal activity. Countries such as Ghana, Zambia, and Ethiopia experienced heightened fiscal pressure during this period, contributing to a broader repricing of risk across the continent. 

In the most recent period, July 2022 to June 2025, the distribution partially reverted to its pre-COVID pattern. Transactions above 7x recovered to approximately 60%, while the mid-range contracted to 20% and the sub-3.5x segment increased to 20%. The partial recovery in the premium band aligns with the median Africa ex-SA EV/EBITDA multiple rising from a cycle low of 6.6x in June 2021 to 9.5x in June 2023, before moderating to 7.0x by June 2025. The persistence of a 20% sub-3.5x segment likely reflects a shift in the deal sample toward smaller transactions. 

PE Pricing by Transaction Size

South Africa 

The relationship between deal size and entry multiples in South Africa has been neither linear nor stable. This reflects limited deal flow within specific size bands and the unique characteristics of individual large transactions. 

Small-cap transactions below USD 25 million have remained within a narrow range, with median EV/EBITDA multiples of approximately 4.7x from July 2016 to June 2019, compressing modestly to 4.5x during the July 2019 to June 2022 cycle, and holding at approximately 4.6x in July 2022 to June 2025. This stability is structurally driven, as small-cap South African deals typically involve founder exits, Black Economic Empowerment (BEE) transactions, or early-stage growth businesses with limited EBITDA and a buyer pool largely restricted to domestic mid-market funds. Valuations in this segment generally reflect limited competitive tension and a narrower buyer pool, rather than underlying earnings quality, and have demonstrated limited sensitivity to macroeconomic cycles compared with those of larger transactions. 

Middle-market transactions in the USD 25 million to USD 100 million range experienced the most significant repricing during the study period. The median multiple declined from approximately 8.3x between July 2016 and June 2019 to 5.9x between July 2019 and June 2022, then partially recovered to 6.1x in the July 2022 to June 2025 window. The repricing in this band tracks the derating of South African listed comparators over the same period; the partial recovery in the latest window suggests the middle market has settled into a more sustainable equilibrium roughly two turns of EBITDA below the pre-COVID level. 

Large-cap transactions in the USD 100 million to USD 250 million range have compressed steadily across the study period, with the median falling from 7.0x in the July 2016–June 2019 period to 5.7x in the July 2019–June 2022 period and 5.5x in the most recent period. The USD 250 million-plus segment is sparsely populated, with eight transactions across the full study period, no calculable median for the earliest window (single deal), and medians of approximately 10.0x in both the 2019-2022 and 2022-2025 windows. These large-cap figures should be interpreted as period-specific readings anchored on a small number of premium assets, rather than broad-market readings. 

Transaction count data from the internal RisCura transaction database shows the predominance of small- and mid-cap deal flow in South Africa. Of the 81 South African deals with disclosed size data across the study period, the USD 0-25 million bucket accounts for 35, while the USD 25 million to USD 250 million mid-market accounts for a further 38. A further eleven transactions in the 2016-2019 window had no enterprise value disclosed, highlighting the persistent inconsistency in EV disclosure, particularly among smaller fund managers and in BEE transactions.

Africa ex-South Africa 

The deal-size distribution for Africa excluding South Africa indicates a structural shift toward smaller transaction sizes, which is reshaping the pricing dynamics of the asset class. 

During the July 2016 to June 2019 period, the deal population outside South Africa was distributed broadly across size bands, with 11 deals with enterprise values above USD 100 million and 14 below USD 25 million. Median multiples were tightly clustered: USD 0-25 million at 7.9x, USD 25-100 million at 7.9x, USD 100-250 million at 8.2x, and USD 250 million-plus at 8.6x. This uniformity is a distinctive feature of the Africa ex-SA market. Buyers applied a consistent growth premium across deal sizes rather than discounting small-cap assets for illiquidity, as is typical in South Africa. 

Between July 2019 and June 2022, large-cap activity thinned out sharply. The USD 100-250 million band retained five disclosed multiples at a median of 8.45x, broadly flat against the prior window, but the USD 250 million-plus segment registered zero disclosed multiples. Median compression was modest in the 25-100 million band (7.5x) but sharp in the 0-25 million band (5.5x, down from 7.9x). A further nine transactions over the period had no disclosed enterprise value at all, the largest single category for the window, underscoring how thin the visible pricing record is, particularly at the top end. 

In the most recent period, from July 2022 to June 2025, the disclosed-multiples cohort has shifted further towards the small- and mid-cap segments. The 0-25 million band saw 4 disclosed multiples at a median of 5.0x; the 25-100 million band 11 disclosed at 7.0x; the 100-250 million band 9 disclosed at 7.0x; and the 250 million-plus band 4 disclosed at 12.8x. The 250 million-plus median is anchored by a small number of premium infrastructure and energy-adjacent transactions and should be interpreted with caution. The broader pattern is one of compression in small- and mid-cap pricing alongside outsized prints in the largest segment, where the deal mix favours assets with contracted cash flows. 

This structural shift toward smaller transaction sizes is supported by continent-wide market data. In 2024, for the first time in a decade, deals below USD 50 million accounted for more than 50% of total African private capital deal values. The average deal size declined to USD 15.2 million from USD 18.2 million in 2023, and large deals above USD 250 million decreased by 85% year-on-year (AVCA, 2025). Although total deal value declined slightly to USD 5.5 billion, down 7% year-on-year, this trend indicates investors’ growing preference for smaller, more strategic deal sizes amid macroeconomic uncertainty (AVCA, 2025). 

The pricing implications are significant. As the deal population shifts toward smaller, earlier-stage businesses with less established earnings, median multiples in Africa ex-SA are expected to reflect the growth premium of this cohort rather than the cash-flow-driven valuations typical of mid- and large-cap buyouts. Collectively, the deal-size data confirm a market dominated by small- and mid-cap transactions, with the most pronounced pricing compression occurring in the mid-market. The absence of large-cap deal flow in the latest period reinforces the structural reality that Africa’s private equity opportunity set is primarily driven by growth capital, where operational value creation, rather than financial engineering, is the primary driver of returns.

Where the Growth Premium Lives: PE Pricing by Sector

South Africa

The South African sector graphs present data across two periods, 2015 to 2019 and 2020 to 2025, with bubble size reflecting transaction count. Only sectors with sufficient observations appear in each period, and the data is drawn from the internal RisCura transaction database. 

Information Technology has been the most resilient South African sector across both periods, recording a median of 7.6x in 2015 to 2019 and holding at 7.0x in 2020 to 2025. It remains the clearest premium sector, supported by capital-light, high-margin software and payments businesses and an active pan-African buyer pool competing for technology assets. 

Industrials recorded a median of 5.8x from 2015 to 2019, compressing only modestly to 5.6x from 2020 to 2025. The sector remains one of the most active by transaction count, reflecting the breadth of the classification across manufacturing, logistics and business services, but pricing remains consistent with South Africa’s low-growth mid-market environment. 

Consumer Discretionary experienced the most significant multi-period compression among South African sectors, declining from 6.9x in 2015–2019 to 4.9x in 2020–2025. Consumer Staples also compressed, from 6.1x to 4.7x, despite its defensive profile. Together, these movements reflect pressure on consumer-facing businesses from stagnant real incomes, elevated unemployment and the prolonged effects of load shedding. 

Healthcare recorded 4.7x in 2020 to 2025; the sector was not plotted in the 2015-2019 graph, so no direct cross-period graphical comparison is available. Materials, Financials, Energy and Communication Services are thinly represented in the disclosed-multiples cohort and should therefore be treated as directional rather than definitive. 

The South African sector data therefore reinforces the broader pricing pattern: IT has retained a premium, while most consumer and industrial sectors have compressed or stabilised at more conservative levels. 

Africa ex-South Africa 

Sector data for Africa excluding South Africa indicates a more diverse, growth-oriented market, with higher multiples across several sectors and greater dispersion between sectors. 

Information Technology and Financials sit at the upper end of the Africa ex-SA valuation range. Information Technology businesses, digital platforms and infrastructure providers traded at 7.9x in 2017-2019 and 7.6x in 2020-2022, supported by scalable models and increasing digital adoption. Financials recorded 8.6x in 2017-2019 and rerated to 11.7x in 2023, reflecting structural opportunities in financial inclusion and rapidly expanding payments ecosystems. 

Consumer Discretionary, which in this dataset includes hospitality, education and retail, recorded the highest single-period median in the chart at 12.8x in 2020-2022, albeit on a thin sample. The sample size limits interpretation, but the reading reflects the premium attached to assets exposed to long-term consumption growth, urbanisation and rising incomes across key regions. 

Consumer Staples has shown more consistent activity, with multiples of 9.7x in 2017 to 2019 and 7.5x from 2020 to 2022, based on larger transaction samples. The most recent reading of 7.6x indicates sustained investor demand for essential goods businesses with relatively stable demand characteristics. 

Industrials declined from 7.9x to 5.2x across the first two periods, reflecting supply chain disruption, currency volatility and input cost inflation. The 2025 reading of 5.4x suggests a partial recovery. 

Healthcare recorded a higher multiple of 11.8x in the most recent period, but this figure is based on a single transaction and should not be interpreted as a broader trend. A more representative benchmark is the 7.0x median observed across eight transactions in the 2020-2022 period. 

Energy produced the highest multiple in the dataset at 15.4x in 2020-2022 across four transactions. These transactions typically involved larger, infrastructure-like assets with contracted revenues and USD-denominated cash flows, where pricing dynamics differ from traditional private equity investments. 

Implications

Across both geographies, the sector data confirms that the growth premium in African PE is neither uniform nor static. In South Africa, the premium has compressed across most consumer and industrial sectors, with Information Technology the clearest resilient premium. Outside South Africa, Consumer Staples has been the most consistent premium sector, while Energy recorded the chart’s highest reading (15.4x in 2020-2022) on a small sample. For investors, the sectoral data shows that above-average returns require either genuine sector expertise where premiums are durable, or the operational capability to create earnings growth where entry multiples have compressed but recovery potential exists. 

The Role of Debt in African Private Equity Pricing 

A key structural difference between private equity markets in Africa and those in developed economies is the role of debt in transaction pricing and return generation. This distinction is essential for interpreting African private equity multiples accurately and avoiding direct comparisons with leveraged buyout valuations in the United States or Europe. 

In mature markets such as the United States, leverage has historically served as a principal driver of private equity returns. High levels of senior debt reduce the equity required at entry and allow sponsors to amplify returns through tax shields, debt repayment and refinancing activity. This creates a direct link between credit market conditions and entry multiples: when debt is cheap and plentiful, sponsors can bid more aggressively, and EV/EBITDA multiples tend to rise accordingly. 

This transmission mechanism does not operate in the same way in Africa. Leverage plays a structurally secondary role in African PE transactions. Among eligible transactions with sufficient disclosed financing information, sub-USD25m transactions carried little or no debt on average; the USD 25m to USD 100m middle-market segment averaged approximately 0.9x Debt/EBITDA; and even the largest transactions above USD 250m averaged only 2.3x, well below the 5x or more standard in comparable US and European deals (Ninety-One, 2024). As a proportion of enterprise value, debt peaks at around 29% for the largest African transactions, compared to a ten-year average of approximately 54% in North American and European buyouts prior to the 2022 rate cycle. 

The structural reasons are both supply-side and demand-side. On the supply side, African corporate debt markets remain shallow and the leveraged finance instruments that underpin large buyouts elsewhere, such as syndicated loans, high-yield bonds and covenant-lite structures, are either absent or severely limited across most African jurisdictions. On the demand side, growth capital dominates the African deal mix, with businesses investing in expansion rather than generating the stable, contracted cash flows required to service significant debt loads. 

Private credit is nonetheless gaining traction as an alternative financing source. African private debt deal values grew 14% year-on-year in 2024, and volume rose a further 23% year-on-year in Q2 2025. DFIs remained the dominant funder, but the broader gap persists: only 0.3% of the global USD 1.7 trillion private credit market reaches Africa, and total African corporate debt outstanding fell from approximately USD 230bn in 2020 to USD 180bn in 2024. 

The implication for PE pricing is significant. Because African entry multiples are not debt-supported in the way that US and European buyout multiples are, they reflect a more direct assessment of intrinsic earnings power and growth trajectory. This makes African PE valuations less sensitive to interest rate cycles, but also means value creation depends more on earnings growth, management quality, operational capability and sector expertise than on leverage pay-down or financial engineering.