Target Company Target Sector Target Country Bidder Company Deal Value (US$mn) Wirelesss infrastructure of China Mobile Ltd. Telecom Services China China Tower Corp Ltd. 18,326.5 Focus Media Technology Shanghai Co., Ltd. Advertising Sales China Hedy Holding Ltd. 9,104.0 CSAV Group Agencies Korea Co., Ltd. Marine Shipping Korea CSAV Germany Container GmbH 8,805.8 China Merchants Property Development Co., Ltd. Real Estate Development China China Merchants Group Ltd. 7,050.6 Beijing Capital Land Ltd. Real Estate Development China Beijing Capital Group Co., Ltd. 3,477.2 Asia-Pacific M&A Volume and Value Comparison Top 5 Deals for H2 2015 1,500 2,000 2,500 3,000 150 200 250 300 350 1,922 313.0 2,961 194.9 Deal Volume Deal Value (US $bn) Deal Volume Deal Value (US$bn) H2 2015 H2 2014 Asia-Pacific M&A Barometer ISSUE 8 FEATURING 2016 M&A Outlook in Singapore Trend in 2H 2015 2,961 US $194.9bn Deal Volume Deal Value Top 3 countries by deal volume: 743 China 605 India 384 Australia Top 3 sectors by deal volume: 17% Consumer, Non-cyclical 17% Financial 15% Communication 78% Number of deals valued below 50 million as a percentage of total regional deal volume 9% Number of deals valued between 50 million and 100 million as a percentage of total regional deal volume Top 3 sectors by deal value: 32% 25% 13% Communication Financial Industrial M&A activities from Asia Pacific in the second half year of 2015 saw a 37% year-on-year decrease in total deal value to US$194.9 billion. China, India, Australia, Japan and Singapore are the top 5 most active acquirers in 2015 in terms of deal volume among Asia Pacific countries. Total deal value of completed Merge and Acquisition (M&A) transactions in 2H 2015 has slipped by 37% from US$313.4 billion to US$194.9 billion. Despite the decrease in total deal value, total deal volume has increased from 1,922 in 2H 2014 to 2,961 in 2H 2015. The increase in deal volume in 2H 2015 was mainly due to increase in completed M&A transactions with a deal value of less than US$500 million (2H 2015: 2,082 deals; 2H 2014: 1,221 deals). These small deals dominated the M&A market in Asia Pacific. Such significant increase was mainly driven by the global stock market crash in the second half year and by the slow growth in certain industries (i.e. Financial and Communication industry).
Transcript
Target Company Target Sector Target Country Bidder Company Deal Value
(US$mn)Wirelesss infrastructure of China Mobile Ltd.
Telecom Services
China China Tower Corp Ltd. 18,326.5
Focus Media Technology Shanghai Co., Ltd.
Advertising Sales
China Hedy Holding Ltd. 9,104.0
CSAV Group Agencies Korea Co., Ltd.
Marine Shipping Korea CSAV Germany Container GmbH 8,805.8
China Merchants Property Development Co., Ltd.
Real Estate Development
China China Merchants Group Ltd. 7,050.6
Beijing Capital Land Ltd. Real Estate Development
China Beijing Capital Group Co., Ltd. 3,477.2
Asia-Pacific M&A Volume and Value Comparison
Top 5 Deals for H2 2015
1,500
2,000
2,500
3,000
150
200
250
300
350
1,922
313.0
2,961
194.9
Dea
l Vol
ume
Deal Value (U
S $bn)
Deal Volume Deal Value (US$bn)
H2 2015H2 2014
Asia-PacificM&A BarometerISSUE 8 FEATURING 2016 M&A Outlook in Singapore
Trend in 2H 2015
2,961 US $194.9bnDeal Volume Deal Value
Top 3 countries by deal volume:
743 China
605 India
384 Australia
Top 3 sectors by deal volume:
17% Consumer, Non-cyclical
17% Financial
15% Communication
78%Number of deals valued below 50 million as a percentage of total regional deal volume
9%Number of deals valued between 50 million and 100 million as a percentage of total regional deal volume
Top 3 sectors by deal value:
32%25%13%
Communication
Financial
Industrial
M&A activities from Asia Pacific in the second half year of 2015 saw a 37% year-on-year decrease in total deal value to US$194.9 billion. China, India, Australia, Japan and Singapore are the top 5 most active acquirers in 2015 in terms of deal volume among Asia Pacific countries.
Total deal value of completed Merge and Acquisition (M&A) transactions in 2H 2015 has slipped by 37% from US$313.4 billion to US$194.9 billion. Despite the decrease in total deal value, total deal volume has increased from 1,922 in 2H 2014 to 2,961 in 2H 2015. The increase in deal volume in 2H 2015 was mainly due to increase in completed M&A transactions with a deal value of less than US$500 million (2H 2015: 2,082 deals; 2H 2014: 1,221 deals). These small deals dominated the M&A market in Asia Pacific. Such significant increase was mainly driven by the global stock market crash in the second half year and by the slow growth in certain industries (i.e. Financial and Communication industry).
10%
20%
17%
12%9%
9%
9%
6%
6%
4%4% 2%
1% 15%
16%
15%
8%
2%
2%
2%
2% 2%
10%
15% 15%
12%
6%
25%
17%17%
15%
14%
3%
5%
13%
32%
1%
3%
10%
1%
Deal Value
Deal Volume
2%
1%2%
6% Basic Materials
Communication
Consumer, Cyclical
Consumer, Non-Cyclical
Diversified
Energy
Financial
Industrial
Technology
Utilities
Asia-Pacific Sector Breakdown 2H 2015
0100200300400500600700800
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Taiw
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110.3
20.1 18.4 12.9 10.0 9.3 6.4 2.3 2.0 0.9
Asia-Pacific Deal Volume (Top 10 Jurisdictions)
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743
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383 348251
174 15496
47 45
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110.3
20.1 18.4 12.9 10.0 9.3 6.4 2.3 2.0 0.9
Asia-Pacific Deal Value (Top 10 Jurisdictions)
by Deal Value
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
China India South Korea
Indonesia
Kazakhstan Vietnam Taiwan Malaysia
Thailand Philippines Japan Australia
Singapore New Zealand Hong Kong
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
China
Kazakhstan
Thailand
Singapore
India
Vietnam
Philippines
New Zealand
South Korea
Taiwan
Japan
Hong Kong
Indonesia
Malaysia
Australia
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Communication
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Technology
Industrial
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Consumer/Non-Cyclical
Financial
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
by Deal VolumeH2 2015 Top Sectors
Key:
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Key
Resource& Energy
Industrials & chemicals
Consumer
TMT
Business services
Real estate
Agriculture
Consumer/Noncylical
Consumer/Cylical
Communication
Technology
Industrial
Basic Material
Utilities
Undisclosed
Financial services
Pharma, medical & biotech
Other
Transportation
Leisure
Geographic split across Asia-PacificIn 2H 2015, China remained its leading position in the M&A market despite the decline in GDP growth and the turmoil of the Chinese stock market. China has completed 743 deals with US$110.3 billion in deal value, which represented over half of the M&A deal value in the Asia-Pacific region. One of the major transactions, which accounted for over 30% of the total completed deal value in the Asia-Pacific region in 2H 2015 was the transaction between “Big Three” telecommunication operators (China Mobile, China Unicom, China Telecom) and China Tower Corp. Ltd., a State-owned enterprise. The Big Three telecommunication operators have sold and transferred assets with a total worth of over US$34.2 billion to China Tower Corp. Ltd. After the transaction, China Mobile owns a 38% stake, while China Unicom and China Telecom own 28% and 28%, respectively, in China Tower.
South Korea continued to be the most important country in the M&A Market besides China in the Asia-Pacific region. In 2H 2015, it remained as second place in total deal value, contributing US$20.1 billion. The value was mainly attributed to the exceptional performance in the industrial sector, which represented 62% in total value. Besides China and Korea, India also contributed greatly to total volume of the M&A deals in Asia Pacific with 605 deals in total.
Section breakdownIndustrial, technology, consumer, financial and communication were the top 5 targeted sectors in the Asia Pacific region to the acquirers. The industrial and technology industry continued to contribute heavily in the China M&A market due to the needs for companies to reinvest themselves to remain competitive in the global market, which has been a major driving force for the robust deal activities in the ‘Industrials’ and ‘Technology’ sector in China. In fact, China and Japan have become the world’s largest acquirers in the technology sector besides US and UK, with 41 deals (total deal value: US$19.2 billion) and 38 deals (total deal value: US$9 billion) respectively, in 2015.
Technology sector is likely to remain popular for cross-border M&A activity in the Asia Pacific region in the near future mainly due to (i) the encouraging government policies in China, (ii) the country’s strong culture of innovation in India, (iii) the growing of educated middle class, and (iv) the proliferation of IT outsourcing companies. An increasing number of deals in the Financial-Technology hybrid industry would be foreseen in 2016 due to the converging trend of technology and other traditional industries. In addition, the online-to-offline (O2O) business sector has a great potential to contribute to the M&A growth in 2016 as the line between online to offline business is vanishing, companies such as Airbnb and Uber are attracting attention from potential investors.
0 20 40 60 80 100
$0 - 50mn
$50 - 100mn
$100 - 500mn
Above 500mnDea
l Siz
e in
US
$
Percentage of Total Deal Volume
Percentage of Total Deal Value
78%10%
9%8%
10%24%
3%58%
2H 2015 M&A Deal Size Breakdown
What were the trends in the M&A market in Singapore in 4Q2015?
Despite the economy growing just 2.1% in 2015, compared to 2.9% in 2014, M&A activity surged during the year. There were 545 completed deals in the full year of 2015, 33% higher than in 2014, while 175 deals were an-nounced or pending, an increase of 43% from 2014. The solid growth in ac-tivity continued in 4Q15 with 146 com-pleted deals, an increase of 16% YoY and 40 deals announced and pending, which was an increase of 25% YoY. In terms of deal value however, 4Q15 fell short, recording USD 7 billion of com-pleted deals, a decline of 36% from 4Q14.
In terms of deal size, Olam Interna-tional’s acquisition of Archer Daniel’s cocoa distribution business valued at US$ 1.3 billion was the only large deal completed (> US$ 1 billion) in the quarter, with the deal contributing 19% of total deal value in 4Q15. Medi-um sized deals (US$ 500 million – US$ 1 billion) dominated value, with the four medium-sized deals accounting for 48% of total completed deal value in 4Q15. Transaction size saw a de-cline to an average of US$ 70 million in 4Q15, from approximately US$ 100 million in 4Q14.
Farm management, accounted for 19% of total completed deal value, attribut-able to the largest observed deal in the quarter. Real estate and property development and banking accounted for 16% and 14% of total deal value re-spectively, due to the mid-sized deals that also dominated the last quarter of 2015. Singapore state-owned inves-tor Temasek Holdings and sovereign wealth fund, Government of Singapore Investment Corporation (GIC), were recurring names in the M&A scene in 2015, accounting for roughly a third of all deals in the year. In the last quar-ter, it was announced that Dell Inc had agreed to buy data storage company, EMC Corp in a US$ 67 billion record
deal, one of the financiers of this mega deal will be Temasek Holdings. Furthermore, in 4Q15, cross border transactions were subdued, with only US$ 1.3 billion worth of inbound deals and US$ 2.5 billion worth of outbound deals being completed.
What were the driving forces in the M&A market in 4Q2015?
Widely considered as the M&A hub of Southeast Asia, M&A activity in Sin-gapore for full year 2015 was twice as much as what was recorded in 2014. The increased M&A activity in 2015 is attributed to a multitude of reasons. Firstly, low interest rates; the SIBOR rate which is currently at 0.21% re-mains amongst the lowest in the world. Secondly, companies are increasingly looking to pursue inorganic growth as organic growth opportunities re-mained limited due to downward eco-nomic pressure in the region as well as globally. Tightening debt markets, and companies in stressed industries seeking new capital, further added to the flurry of M&A activity in 2015. The same forces fuelled M&A activity into 4Q15, despite the relative decline in deal values, with executives staying positive about the larger economic picture despite the regional and global economic slowdown
What is your expectation about the M&A performance in SGP in the next quarter of 2016?
The trend of heightened M&A activi-ties will likely continue into 2016 with Singapore’s Government Linked Com-pany’s (GLCs) restructuring, govern-ment led initiatives in the South East Asian region and companies continu-ing to look for organic growth oppor-tunities amidst the global downturn. Further the ASEAN economic commu-nity initiative which was set to further strengthen economic integration in the ASEAN region took effect at the
end of 2015, is also likely to have a strong positive impact on M&A activi-ty in 1Q16 and continue into the rest of the year. Furthermore, with no marked increase expected in the level of inter-est rates in 1Q16, a favourable M&A climate seems more probable.
According to analysts Duff and Phelps, there are approximately 50 deals val-ued at almost USD 9.1 billion in the pipeline, which should take effect in the coming months. The deals in-clude the announced cash acquisition of Singapore’s Neptune Orient Lines by the world’s third largest container shipping company CMA CGM, which maybe a signal of the start of the much needed consolidation amidst the gloomy environment in the ship-ping industry. The proposed buyout of Singapore based medical devices company Biosensors International by CITIC Private Equity and the potential sale of Asia Square Tower 1 by Black-Rock real estate firm to Norway’s sov-ereign fund, are the other such deals in the pipeline.
2016 M&A Outlook in SingaporeSPEEDA INSIGHT
Deal SizeIn comparison with 2H 2014, the proportion of small deal-size transactions (below 50 million) recorded a sharp increase from 54% in 2H 2014 to 78% in 2H 2015, while these small deal-size transactions only consists of 10% of total value in M&A market. Such increase was driven by the global stock market crash and the decrease in market value of the target companies. Substantial transactions with size over US$500 million contributed only 3% of the total deal volume, but yielded 58% of the total deal value.
China remained dominant in large sized deals in Asia Pacific M&A market. The big three Chinese telecommunication operators have agreed to sell and transfer assets with a total worth of over US$34.2 billion to China Tower Corp. Ltd., which accounted for the largest deal in 2H 2015.
SPEED Analyst Zayna Ghany
All deal details and M&A figures quoted were sourced from Bloomberg database unless otherwise stated. The information is not intended to be taken as advice with respect to any individual situation and cannot be relied upon as such. All $ symbols refer to US dollars.
The document is owned by Ascent Partners, and its content or any portion thereof, may not be copied or reproduced in any form without permission of Ascent Partners. Clients may distribute for their own internal purpose only.
CONTACT US William Yuen, Director Ascent Partners Valutation Service Limited [email protected] +852 3679 3822
John Ma, AnalystAscent Partners Valutation Service [email protected]+852 3679 3833
Ma Yuki Ge, Sales ManagerUZABASE Hong Kong, [email protected]+852 5808 3148
Inbound M&A
Key:Inbound (Deal Volume) Value (US$ mn)Percentage of total deal volume
Singapore143.731%
Indonesia371,841.424%
Thailand42.013%
Malaysia40.511%
Philippines110
6,287.729%
China7
17.130%
Taiwan35
3,146.510%
South Korea22459.823%
Hong Kong127
13,482.017%
New Zealand00.00%
India8
547.135%
Kazakhstan17
458.136%
Japan249,173.310%
Australia2508,971.541%
Vietnam452,454.326%
0 20 40 60 80 100
China
India
Japan
Australia
South Korea
Singapore
Hong Kong
New tZealanda
Malaysia
Rest of Asia
72%69%
48%30%
30%9%
16%9%
62%21%
40%22%
15%30%
36%14%
29%11%
48%14%
Percentage ofTotal Deal Volume
Percentage ofTotal Deal Value
%
Private Equity Buyout ActivityPrivate EquityPrivate equity in the Asia-Pacific region yielded US$51.8 billion in buyouts in 2H 2015, with 26% of deals and 60% of dollars invested in China. Despite the stock market crash in China for during 2H 2015, China remained popular with investors due to its long-term potential in the market.
India surpassed China to become the largest private equity market in the Asia-Pacific region with 436 deals in 2H 2015, which accounted for 32% of the total deal volume. Although the total deal volume is large, the deal value in the Indian private equity market is significantly lower than China, which indicates the small sized deals have dominated the market in 2H 2015. Private equity investors in India continue to be confident in investment opportunities and is expecting a strong performance in private equity market in 2016.
Private equity in South Korea recorded a sharp increase in 2H 2015, reaching 156 deals with a total deal value of US$4.2 billion. The private equity transactions began to contribute heavily in the South Korea M&A market (62% by total deal volume and 21% by total deal value), which indicates that investors are confident in terms of future economic growth.
Inbound The value of inbound deals into the Asia Pacific region reached US$46.8 billion in 2H 2015, up by 141% in comparison to 2H 2014. India and Australia have become the favored targets by US and European companies, while China continued to be the most popular country in 2H 2015 with 127 deals, with a total deal value of US$1.4 billion. US-based firms announced 433 deals (65.1% of total deal volume) with total deal value of US$26.5 billon, European companies completed 172 acquisitions (24%) with total deal value of US$15.2 billion.
In 2015, India changed its policy and allowed 100% foreign direct investment in various industries. The Indian government waived foreigners’ investment holding limits in Indian companies and lowered restrictions in major industry sectors, such as medical devices, single-brand retail and construction. The technology sector in India was particularly attractive to foreign acquirers in 2015 and 22 deals were completed. One of the major deals included the acquisition of 53% stake in Polaris, an India software company by Virtusa, a US-based IT outsourcing firm for US$350 million.
