By Adebomi Adekeye, Esq
There is a moment in the life of a successful business when the conversation changes.
For years, the questions may have been about getting customers, raising revenue, hiring the right people, entering new markets and staying ahead of competitors.
Then, perhaps after several years of building, an investor wants to put money into the business or another company makes an offer to acquire it.
The founders are understandably focused on the valuation, the terms of the deal and what the transaction means for the future of the business. Then the due diligence begins.
Among the financial statements, corporate records, employment agreements, regulatory approvals and commercial contracts comes a question that can appear deceptively simple: what exactly does the company own?
For businesses whose value is built substantially around technology, brands, content, inventions, proprietary processes or other intangible assets, this question can become one of the most important questions in the entire transaction.
It is also one that many businesses leave too late.
This matters now because African businesses are entering a period in which investment and acquisition are becoming increasingly important routes to growth and consolidation.
African technology companies recorded 67 mergers and acquisitions in 2025, according to TechCabal Insights data, representing a 72 per cent increase from the previous year.
The deals were not simply about distressed companies being rescued; increasingly, businesses were acquiring technology, infrastructure, licences, capabilities and access to new markets.
That shift has implications beyond the technology sector. As Nigerian and African businesses become larger, more sophisticated and more attractive to institutional capital, the quality of the intangible assets supporting those businesses will increasingly matter to investors and acquirers.
The important question is therefore not simply whether a company has intellectual property. It is whether the company has clear, enforceable and commercially useful rights over the intellectual property that creates its value. That distinction can be worth millions.
*Building something is not the same as owning it
Consider a technology company that has spent five years developing a platform. The founders have invested heavily in developers, designers and consultants. The platform works, customers are using it and the company has begun to attract serious commercial interest.
The founders naturally think of the platform as an asset of the company because the company paid for its development.
But what happens when a prospective investor asks for the development agreements?
Perhaps some of the software was developed by employees, while another part was developed by independent contractors. Perhaps one of the contractors worked through another company.
Perhaps the contracts were signed at different stages of the company’s growth and contain different provisions dealing with intellectual property. Perhaps the founder personally commissioned some of the early work before the company was incorporated.
The business may have built an excellent product. The legal ownership of every component of that product, however, may not be quite as straightforward.
This is where the distinction between creation and ownership becomes important. Paying someone to create intellectual property does not, in every circumstance, answer the question of who owns the resulting rights. The contractual arrangements, the nature of the relationship, the applicable law and the particular intellectual property involved can all matter.
The same issue arises with trademarks. A founder may have registered a company’s principal brand in her personal name when the business was still small and informal. At the time, it may have seemed harmless. Five years later, the company has raised institutional capital and the brand is one of its most valuable assets.
The question then becomes: why is an asset fundamental to the company’s business sitting outside the company?
These are precisely the kinds of questions that become more consequential when money is about to change hands.
*Africa’s M&A market is becoming more strategic
Recent transactions across the continent demonstrate why this matters.
In January 2026, Flutterwave announced its acquisition of Nigerian open-banking company Mono. Flutterwave described the transaction as a way of bringing Mono’s open-banking infrastructure into its wider payments ecosystem, with Mono’s API-driven technology providing capabilities around financial-data access, identity verification and account-to-account payments.
The transaction is interesting because it illustrates a broader point about what modern businesses are sometimes buying. The value of an acquisition may lie not simply in the target’s existing revenues but in the technology, infrastructure and capabilities that can be integrated into the buyer’s own business.
There is a similar strategic logic in Moniepoint’s acquisition of a 78 per cent stake in Kenya’s Sumac Microfinance Bank. The transaction gave the Nigerian fintech access to a licensed deposit-taking institution in Kenya, allowing it to enter the market with regulatory infrastructure already in place rather than building everything from scratch.
These transactions are different, but together they illustrate how acquisition decisions increasingly involve the purchase of capabilities: technology, infrastructure, licences, market access, distribution and intellectual assets.
That means the question of what sits underneath the corporate entity becomes increasingly important.
What happens when the asset is not where everyone thinks it is?
Imagine an acquisition of a Nigerian technology company valued at ₦10 billion.
The company has a recognisable brand, a strong customer base and software that appears to be the foundation of its competitive advantage. The buyer is comfortable with the financial performance and sees significant opportunities to expand the business across West Africa.
During due diligence, however, the buyer discovers that the founder owns the principal trademark personally. Some of the core software was developed by contractors whose agreements did not adequately deal with assignment of intellectual property rights.
A critical component of the technology is licensed from another company, and the licence contains restrictions on transfer. Some intellectual property is held by a foreign subsidiary that was never properly incorporated into the group’s restructuring.
None of these problems necessarily destroys the transaction. But they change it.
The buyer may require the founder to transfer the trademark before closing. It may insist on new intellectual property assignments. It may seek consent from the third-party licensor. It may require additional warranties or indemnities. It may delay completion while the ownership structure is cleaned up.
And if the problem affects something fundamental to the business and cannot be satisfactorily resolved, the buyer may reconsider what it is prepared to pay.
This is where intellectual property becomes a valuation issue.
Two businesses can generate similar revenue and have similar growth prospects while carrying very different levels of legal certainty around the assets that underpin their businesses. The business with cleaner ownership and stronger contractual foundations may simply be easier to finance, easier to sell and easier to integrate.
In other words, good IP housekeeping can have commercial value even when it does not appear as a line item on the balance sheet.
*Businesses should prepare before the deal arrives
The most effective time to resolve intellectual property problems is when there is no transaction hanging over the business.
A company preparing for investment or acquisition should be able to identify the intellectual property that is material to its business and understand who owns each significant asset, how the rights were acquired, where they are registered, what licences apply and what obligations exist in relation to employees, contractors, founders, partners and third parties.
This becomes even more important as an African business expands across borders. The intellectual property structure that worked when a company operated solely in Lagos may require greater thought when that company has subsidiaries or customers in Kenya, Ghana, South Africa, the United Kingdom or the United States.
Cross-border growth creates opportunities, but it also creates more places in which ownership, licensing and enforcement questions can arise.
The objective should not be to create paperwork for its own sake. It is to ensure that the legal structure reflects the commercial reality of the business.
If a company’s most valuable asset is its technology, the company should know who owns that technology. If its brand is central to its market position, the company should know where the brand is protected and by whom. If its business depends on third-party licences, management should understand what happens to those licences when the company is sold or reorganised.
These questions are much easier to answer when they are addressed as part of ordinary business management rather than in the final weeks before an investment or acquisition.
*The deal is not the time to discover what you own
Africa’s businesses are entering an interesting phase. The emphasis is gradually moving from building businesses at any cost to building businesses that can withstand institutional scrutiny, attract strategic capital and participate in larger transactions.
That evolution should change how entrepreneurs think about intellectual property.
The objective should not simply be to prevent somebody else from copying the business. It should also be to build an asset that the business can confidently use, commercialise, license, finance and, when the time comes, transfer.
For founders, this means thinking about intellectual property from the beginning, not when an investor’s lawyer requests the due diligence schedule. For boards and management teams, it means treating significant intellectual property as part of the company’s strategic assets.
For investors and acquirers, it means looking beyond the headline valuation and asking what actually supports the value being presented.
Those questions may not be as exciting as announcing a new funding round or an acquisition. They are, however, the questions that can determine what happens when the announcement is finally ready to be made.
Before the deal, know the asset. Before the valuation, establish the rights. And before asking someone to invest in or acquire your business, make sure you can demonstrate that you own what you are asking them to buy.
*Adebomi Adekeye, Co-Founder and Partner at EandC Legal, is a corporate lawyer and chartered accountant advising technology companies, investors and emerging businesses on fintech, regulation, data protection and cross-border transactions. Email: hello@uyilaw.com
