Foreign direct investment (FDI) is an important source of external capital for developing economies, providing financing for businesses, supporting expansion, and facilitating the transfer of technology and expertise. For Kenya, recent large cross-border transactions demonstrate that international investors continue to identify opportunities within the country’s corporate and financial sectors. Beyond the immediate value of individual transactions, these investments can influence capital markets, competition, corporate governance, and the long-term structure of key industries.
Kenya attracted a record US$3.2 billion in FDI in 2025, compared with a revised US$2.32 billion in 2024, according to data cited from UN Trade and Development. The increase highlights the growing scale of international investment into the Kenyan economy. Importantly, recent activity suggests that foreign investors are not only establishing new operations but are increasingly acquiring stakes in existing businesses.
One of the most notable developments has been the acquisition of a majority stake in NCBA Group by South Africa’s Nedbank. The Central Bank of Kenya approved Nedbank’s acquisition of a 66% majority stake in NCBA on August 28, 2026. The transaction provides Nedbank with a larger presence in East Africa while giving NCBA access to the resources and regional network of a larger financial institution. The remaining NCBA shares continue to trade on the Nairobi Securities Exchange.
The transaction illustrates how cross-border acquisitions can function as a form of strategic expansion. Instead of building a new banking operation from the ground up, an international institution can acquire an established business with an existing customer base, distribution network, infrastructure, employees, and regulatory approvals. This can potentially reduce the time and costs associated with entering a new market.
A similar trend has emerged in Kenya’s cement industry. Tanzania’s Amsons Group acquired a 99.9% controlling stake in Bamburi Cement for approximately US$183 million, equivalent to about KSh23.6 billion, while also acquiring shares in East African Portland Cement. The transaction demonstrates the growing role of regional African capital in reshaping ownership of established Kenyan companies.
For shareholders, acquisitions can have several implications. A takeover may provide an exit opportunity for existing investors, particularly where an acquiring company offers a premium to the prevailing market price. At the same time, a change in ownership can alter the strategic direction, capital-allocation policy, dividend approach, governance structure, and growth strategy of the acquired company.
For the Nairobi Securities Exchange, however, large acquisitions can produce a more complicated outcome. When a listed company is acquired and subsequently delisted, investors may benefit from the transaction in the short term, but the market loses one listed counter. This can reduce the number of publicly traded investment opportunities and potentially affect market depth and sector representation.
Cross-border investment can also influence competition. In banking, for example, an international acquisition can provide additional capital and expertise while potentially strengthening the acquired institution’s ability to compete. In manufacturing, a well-capitalised strategic investor may have the capacity to finance modernisation, improve production efficiency, expand distribution, or access new regional markets.
However, the benefits of FDI depend significantly on the investment environment. International investors generally consider factors such as market size, economic growth, infrastructure, access to skilled labour, taxation, regulatory requirements, political and policy stability, and the ease of repatriating capital. Consequently, attracting capital is only one part of the equation; maintaining an environment in which investors can operate predictably is equally important.
Recent developments in Kenya’s financial markets also demonstrate that foreign and domestic capital are operating alongside changing asset-allocation preferences. On October 1, the Treasury-bill auction attracted KSh47.7 billion in bids against KSh28 billion offered, representing a 170.4% subscription rate. A September 30 Treasury bond auction similarly received KSh80.6 billion in bids against KSh50 billion offered. Meanwhile, equity trading activity weakened, with shares traded and equity turnover declining during the latest reported week.
This environment reinforces the importance of distinguishing between capital inflows and capital allocation. Investors may have substantial capital available, but the destination of that capital depends on expected returns, risk, liquidity, valuation, and investment opportunities. Cross-border acquisitions represent one mechanism through which international capital can move into the Kenyan corporate sector, while government securities provide another avenue for deploying capital.
The investment implications extend beyond individual transactions. A sustained increase in strategic foreign investment can improve corporate access to capital, introduce new technologies and management practices, strengthen regional integration, and potentially increase productivity. It can also create opportunities for local investors through partnerships, supply-chain development, employment, and expansion of businesses into regional markets.
Nevertheless, analysts should assess each transaction on its fundamentals rather than interpreting rising FDI automatically as evidence of broad-based economic strength. The quality of capital matters, as does the sector receiving the investment, the structure of the transaction, the valuation paid, and how the new capital is ultimately deployed.
Ultimately, Kenya’s recent cross-border transactions demonstrate that FDI is becoming an increasingly important component of the country’s investment landscape. For investors, the trend provides an additional lens through which to assess corporate ownership changes, industry consolidation, valuation opportunities, and the future development of Kenya’s capital markets. As international and regional investors continue to seek established platforms for expansion, the ability of Kenya to attract, retain, and productively deploy long-term capital will remain an important determinant of its investment-market development.
