Despite the recent turmoil in which many African countries find themselves, global investors showed strong interest in investing in Africa’s real economy, as evidenced by the increase in private equity fund raising in 2015. Total value of African private equity funding, by year of final close, was US$4.3bn.

This is according to Bright Africa, the ongoing research endeavour from Africa investment specialists, RisCura.

“The slowdown in the growth of emerging market economies hasn’t inhibited the ability of African investment managers to attract significant amounts of capital, particularly for the larger pan-African funds as well as sub-Saharan Africa funds,” said Rory Ord, executive at RisCura.

Some of the largest African private equity funds seen to date were closed in 2015, including Helios Investors Fund III ($1.1bn), Abraaj Africa Fund III ($990m) and African Development Partners Fund II ($725m).

“Investors making commitments to Africa may be flocking to these experienced managers as a way of mitigating their risk, knowing that the next few years are bound to be a more difficult time for the continent,” Ord said.

The last four years have seen an increase in private equity market multiples on the continent. Over the 2009 to 2013 period, more than half of private equity transactions took place at lower than a 6x multiple. In 2014 and 2015 however, less than a third of private equity transactions took place at that level.

Over 30% of reported private equity transactions in 2014 and 2015 took place at greater than a 10x multiple, while this was less than 20% of cases in the earlier periods.

In contrast, the EV/EBITDA multiples of listed equity on the continent have remained relatively flat over the 2013 – 2015 period, with a slight decline from the 2014 levels.

“The reasons for these higher private equity multiples included high-growth expectations, particularly in the short term, and increased competition for deals,” said Ord.

“We also think that perceived risk on the continent may have declined, as investors become more comfortable with the environment leading to a reduction in discounts for risk adjustments.”

The report shows that the consumer discretionary sector continued to attract interest from investors, making up 22% of all transactions in 2015. Of particular interest over the past few years has been online retail, education services such as tertiary education and colleges, as well as advertising and publishing houses.

The consumer sector has been identified time and time again as one of the most attractive areas for investment on the continent, due to the favourable demographics and the so-called ‘growing middle class’. As a result, both the consumer discretionary and consumer staples industries fetch the highest multiples across all sectors.

The financials sector remained a large portion of transaction activity in 2015, making up 16% of total transactions. Points of interest range from regional banking to asset management and financial services across all regions.

Overall, transactions took a dip last year, as the industry seemed to concentrate more on raising funds. The total number of transactions was around 160, a level last seen in 2010 and 2011. On the other hand, mergers and acquisitions activity on the continent appears to have trended upward in 2015 with over 1200 transactions reported, an increase from 990 the previous year.