LegalWeek.com reported this week that “Dealflow and value in Asia Pacific, excluding Japan, last year soared to its highest level since 2001, according to new data from Mergermarket.  The region saw 2,577 deal announcements in 2013 compared with 2,297 in 2012, marking a year-on-year rise of 18.2%.”

“The Asian market was particularly strong in Q4,” the report continued, “with the value of deals topping that of all other parts of the world and up 41.8% compared with the same period in 2012. The region also saw the highest increase in deal value from Q3, up 12.2%.”

But as Allen & Overy reported:  “Most [Asia] cross-border deals were intra-regional, as U.S. and European companies continued to look for deals closer to home. That has created a virtual ring fence around the Asia Pacific region, but one that looks temporary.”

In particular, as the Bangkok Post reported recently:  “Japanese companies’ mergers with and acquisitions of Southeast Asian firms hit a record high of 99 in 2013, up 26.9% from the previous year, [as] Tokyo-based M&A adviser Recof Corp [outlined in a recent report].”

Sectoral, Geogrphic Focuses

“In terms of sectors, energy, mining and utilities M&A remained the most active during the year, with deals worth $93.9bn, up 43.4% from 2012 when value was $65.5bn.  However, real estate saw the biggest increase in value and deal count, topping $36.7bn compared with $11.5bn in 2012 – a rise of 219.1% – and witnessing a 49.4% surge in volume from 81 deals in 2012 to 121 last year.  Pharmaceuticals, medical and biotechnology was another robust sector, recording the second highest increase in dealflow from 153 to 195, and marking a 32% rise in value from $12.5bn to $16.5bn.”

“Looking at cross border deals, Mergermarket said Africa and Middle East saw a significant amount of investment from Asia last year, with the transactions into these markets worth $18.8bn against $7.1bn in 2012 – a 163.4% jump. The annual total of outbound deals into the region thus accounted for 23.4% of total outbound investment from Asia, up from 8.7% in 2012.”  LegalWeek.com continued.

Australia a high-point

Finaly, Allen & Overy reported that “Sentiment in Australia is noticeably more optimistic. With federal elections out of the way, a solid rebound in the equity markets, and the currency becoming more competitive again, potential acquirers seem to be warming to the political and economic fundamentals and considering deals.”

Posted by John Grimley

John Grimley edits and publishes Asia Law Portal

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