Nigeria has steadily emerged as a vibrant hub for mergers and acquisitions (M&A), driven by regulatory reforms, economic diversification, and an evolving investor climate. From oil and gas divestments to bank consolidations and tech-led acquisitions, Nigeria’s M&A space has matured significantly. This article explores Nigeria’s M&A trends, regulatory differences, major deals (up to 2025), strategic reasoning behind transactions, and the future outlook.
Nigeria’s M&A Regulatory Framework: Nigeria vs. Other Countries
Nigeria’s M&A regulatory environment is primarily governed by the Federal Competition and Consumer Protection Act (FCCPA) of 2018, which established the Federal Competition and Consumer Protection Commission (FCCPC). Key distinctions between Nigeria’s regulations and those of other countries include:
- Mandatory Notification Thresholds: Unlike some jurisdictions where notification is voluntary or based on specific thresholds, Nigeria requires mandatory notification for mergers exceeding certain financial thresholds, ensuring regulatory oversight of significant transactions.
- Sector-Specific Approvals: Beyond the FCCPC, certain industries, such as banking and telecommunications, require additional approvals from sector-specific regulators like the Central Bank of Nigeria (CBN) and the Nigerian Communications Commission (NCC). This multi-tiered approval process contrasts with more centralized systems in countries like the United States.
- Local Content Requirements: Nigeria emphasizes local content participation, especially in the oil and gas sector, mandating that indigenous companies hold a minimum percentage of ownership in certain ventures. This approach differs from countries with more liberal foreign ownership policies.
Compared to countries like the U.S. or U.K., Nigeria emphasizes post-merger market impact and consumer protection, rather than purely shareholder value. Foreign investments are subject to CBN regulations and exchange controls, influencing deal structuring and timing.
Frequency and Motivations Behind M&A Activities
M&A activities in Nigeria have seen fluctuations influenced by economic conditions, regulatory changes, and sector-specific dynamics. The motivations driving these transactions include:
- Market Consolidation: Companies pursue M&As to enhance market share, achieve economies of scale, and reduce competition.
- Diversification: Firms seek to diversify their portfolios by entering new markets or sectors, mitigating risks associated with over-reliance on a single industry.
- Foreign Divestment and Local Acquisition: International companies sometimes divest from Nigerian operations due to challenges like regulatory hurdles or security concerns, presenting opportunities for local firms to acquire these assets and bolster indigenous participation.
Historical M&A Activities and Notable Deals
Nigeria’s corporate landscape has been significantly shaped by M&A transactions over the years. Below is a list of 12 notable M&A deals that occurred up until 2023:
- Access Bank + Diamond Bank (2019): $200M merger to create one of Africa’s largest banks.
- Olam + Dangote Flour Mills (2019): $331M acquisition to expand consumer goods footprint.
- Prudent Energy + Forte Oil (2019): N64.38B deal to enter downstream oil market.
- Canal+ + ROK Studios (2019): Strategic entry into Nollywood content.
- Ohara Pharmaceuticals + Fidson (2019): N700M stake acquisition for pharma collaboration.
- MTN Nigeria + Visafone (2016): Spectrum expansion to boost data services.
- Dangote + Benue Cement (2010): Consolidation to boost cement capacity.
- Seplat + Eland Oil & Gas (2019): Strengthened upstream oil asset base.
- Flour Mills + Nigerian Eagle Flour Mills (2010): Market share expansion in flour milling.
- Skye Bank + Mainstreet Bank (2014): N120B acquisition to grow footprint.
- Visafone + Cellcom (2011): ₦2.7B acquisition to expand telecom operations.
- Tower Aluminium + Cook ‘N’ Lite (2007): Merger in the manufacturing sector.
These transactions highlight Nigeria’s dynamic market forces and the strategic intent behind consolidation, diversification, and sectoral repositioning.
Recent Developments in 2024–2025: M&A Momentum Builds
Driven by macroeconomic reform, asset divestments, and recapitalization mandates, 2024 and early 2025 have witnessed record-breaking M&A activity in Nigeria.
| Date | Deal Parties | Sector | Value (USD) | Strategic Rationale |
| Jan 2024 | Shell → Renaissance Consortium | Oil & Gas | $2.4B | Exit onshore operations, focus offshore |
| Feb 2024 | Seplat → ExxonMobil (MPNU assets) | Oil & Gas | $800M | Expand upstream portfolio |
| Mar 2024 | Oando → Eni (NAOC assets) | Oil & Gas | $783M | Increase reserves, indigenous growth |
| Apr 2024 | Equinor → Chappal Energies (Agbami stake) | Oil & Gas | Up to $1.2B | Global portfolio optimization |
| May 2024 | TotalEnergies → Chappal Energies (OML 58, 99, 100) | Oil & Gas | $860M | Divest onshore; focus offshore LNG projects |
| Jun 2024 | Diageo → Tolaram (Guinness Nigeria) | Consumer Goods | N104B (~$70M) | Refocus global portfolio |
| Jul 2024 | Pick n Pay → Exit Nigeria | Retail | Undisclosed | Exit due to macro headwinds |
| Aug 2024 | Providus Bank ↔ Unity Bank | Banking | N700B funding pool | Regulatory-driven consolidation |
| Jan 2025 | Flutterwave → Local Fintech Merger (Rumored) | Fintech | TBA | Pre-IPO market expansion (unconfirmed) |
| Feb 2025 | Chevron Nigeria – Onshore Asset Sale (Expected) | Oil & Gas | TBA | Global restructuring; buyer yet unannounced |
What Worked, What Didn’t
Successful Deals
- Access + Diamond (2019): Delivered strong synergies and digital transformation.
- Seplat + MPNU (2024): Streamlined regulatory process, improved investor confidence.
- Oando + NAOC (2024): Immediate production gains and market repositioning.
Challenged Deals
- Pick n Pay Exit (2024): Failed to scale due to macroeconomic headwinds.
- Tech M&A Rumors (2023–24): Several stalled or abandoned deals due to valuation disagreements and regulatory uncertainty.
Strategic Decisions and Reasoning
The strategic decisions underpinning these M&A activities are influenced by factors such as:
- Regulatory Compliance: Navigating Nigeria’s complex regulatory environment necessitates strategic planning to secure necessary approvals and align with local content policies.
- Market Positioning: Companies aim to strengthen their market positions by acquiring complementary assets or merging with competitors to enhance competitiveness.
- Asset Optimization and Portfolio Restructuring: Many global players such as Shell, TotalEnergies, and Equinor divested their onshore Nigerian assets as part of broader strategies to optimize global portfolios, reduce exposure to geopolitical risks, and focus on energy transition priorities like gas and renewables. For these companies, M&A was a tool to streamline operations and enhance shareholder value.
- Indigenous Empowerment and Local Investment: On the flip side, Nigerian companies—such as Seplat, Oando, and Chappal Energies—have seized M&A opportunities to expand footprints, take control of legacy assets, and fulfill national goals of increasing indigenous participation in the oil and gas sector. These deals are not just about growth, but also national strategy.
- Regulatory Push and Sectoral Reforms: Government reforms, such as the Nigerian Petroleum Industry Act (PIA) 2021 and the Central Bank of Nigeria’s bank recapitalization directive in 2024, have directly influenced the volume and nature of M&A activity. These reforms encourage market consolidation, financial resilience, and improved governance standards, driving more transactions either as strategic necessity or opportunity.
Outlook: What Lies Ahead in Nigeria’s M&A Scene?
Looking ahead, several key drivers are expected to shape Nigeria’s M&A future:
- CBN Recapitalization Mandate (2024–2026): Expect more bank mergers.
- Continued IOC Divestments: Chevron and Total likely to offload additional onshore assets.
- Private Equity Activity: Increasing PE interest in fintech, healthcare, and insurance.
- Public-Private Partnerships: Potential asset privatization, including power and logistics sectors.
Nigeria’s M&A landscape is evolving rapidly, creating both challenges and immense opportunities. Strategic investments, indigenous participation, and regulatory clarity are paving the way for more transformative deals. For local and international investors, Nigeria remains a dynamic and promising market for mergers and acquisitions.