Private Equity - Madagascar | Statista Market Forecast

The deal value in the Private Equity market is projected to reach US$3.86m in 2024.
It is expected to show an annual growth rate (CAGR 2024-2025) of 11.22% resulting in a projected total amount of US$4.30m by 2025.
The average size per deal in the Private Equity market amounts to US$2.31m in 2024.
From a global comparison perspective it is shown that the highest deal value is reached United States (US$594.00bn in 2024).
In the Private Equity market, the number of deals is expected to amount to 2.19 by 2025.

Definition:

Private equity involves partnerships that buy, manage, and eventually sell companies. These firms manage funds for institutional and accredited investors, who commit significant capital for extended periods. Private equity funds can acquire entire private or public companies or participate in buyouts with other investors, but they typically avoid holding stakes in publicly traded companies. The Private Equity market encompasses a broad range of deal types that involve acquiring equity ownership in private companies. This market typically includes leveraged buyouts (LBOs), growth capital, Carve-outs, and other forms of equity investments that target mature businesses with the potential for operational improvements and value creation. The market presented here does not include Venture Capital investments. While both Private Equity and Venture Capital involve equity stakes in companies, Venture Capital specifically focuses on high-growth potential startups, while private equity firms invest in established companies with the aim of increasing the value of these companies before selling their investment after several years.

Additional information:

The market contains the following KPIs: the deal value, the number of deals, the average deal size as well as the assets under management (AUM). Key players in this market are companies such as Blackstone, The Carlyle Group, KKR, Goldman Sachs, General Atlantic, and Warburg Pincus.

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Leveraged Buyouts (LBOs)
Growth Capital
Carve-Outs
Distressed Buyouts
Secondary Buyouts

Venture Capital
Venture Debt
Traditional bank loans
Digital capital raising

The Private Equity market in Madagascar is witnessing a minimal decline in growth, influenced by factors such as political instability, limited investment opportunities, and challenges in regulatory frameworks, which hinder the appetite for substantial capital influx.

Customer preferences: Investors in Madagascar's Private Equity market are increasingly prioritizing sustainable and socially responsible investments, reflecting a growing consumer consciousness toward environmental and social governance. Additionally, the rise of the middle class is shifting preferences toward products that enhance quality of life, prompting investment in sectors like renewable energy, agribusiness, and tech-driven solutions. This cultural shift emphasizes local entrepreneurship, highlighting a demand for innovative business models that address socio-economic challenges while fostering community development.

Trends in the market: In Madagascar, the Private Equity market is experiencing a shift towards sustainable investing, with investors increasingly focusing on environmental and social governance (ESG) criteria. This trend is driven by a rising middle class that demands products enhancing quality of life, propelling growth in sectors such as renewable energy and agribusiness. Furthermore, the focus on local entrepreneurship is fostering innovative business models aimed at solving socio-economic challenges. These dynamics not only reshape investment strategies but also encourage industry stakeholders to align their objectives with community well-being and sustainable development.

Local special circumstances: In Madagascar, the Private Equity market is influenced by its unique geographical and cultural landscape, characterized by a biodiversity hotspot that attracts eco-conscious investments. The local entrepreneurial spirit, driven by cultural resilience and traditional practices, fosters innovation in sustainable business models. Additionally, regulatory frameworks are gradually evolving to support sustainable practices, enhancing investor confidence. These factors create a distinctive environment where PE firms can align financial returns with social impact, addressing local needs while promoting economic growth.

Underlying macroeconomic factors: The Private Equity market in Madagascar is significantly influenced by macroeconomic factors such as central bank policies, particularly interest rates. Low-interest rates can enhance access to capital, encouraging PE firms to invest in local initiatives, while high rates may deter investment due to increased borrowing costs. Additionally, fluctuating inflation rates and currency stability impact financial returns and risk assessments for investors. Global economic trends, such as shifts in commodity prices, also affect the market, as Madagascar's economy is closely tied to agriculture and natural resources, further shaping the investment landscape. These elements collectively influence the attractiveness and performance of the Private Equity market in the region.

Data coverage:

The figures are based on deal value, number of deals, the average size of each deal, and assets under management within the Private Equity market.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players, industry reports, third-party reports, and publicly available databases. In addition, we use relevant key market indicators and data from country-specific associations, such as: GDP, total investment (% of GDP), household wealth (per Adult), high income (% of population), and number of high-net-worth individuals (HNWI). This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are total investment (% of GDP), household wealth (per Adult), number of high-income persons, and number of high-net-worth individuals (HNWI).

Additional notes:

The market is updated twice a year in case market dynamics change.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

In the last decades, private equity has emerged as a dominant force in global finance, reshaping industries and driving economic growth worldwide. After the peak experienced in 2021, however, private equity activity slowed down in 2022 and 2023, due to multiple factors such as inflationary headwinds, rising interest rates, geopolitical unrest and general uncertainty. With an estimated value of nearly four trillion dollars, private equity dry capital - a term commonly used in the private equity world to refer to committed, but unallocated capital - reached unprecedented heights in 2023. A high level of this capital means that private equity firms have unspent cash reserves. Among the most influential private equity firms worldwide, the Blackstone Group is the largest in terms of funds raised.