Southeast Asia Liquidity Events Rise In 2018

Tom Burroughes

12 December 2018

Deal activity from M&A, private equity, venture capital and initial public offerings in Southeast Asia stood at $136 billion, beating the $130 billion figure of 2017, according to data from , the global advisory and valuation firm. Such activity comprises important liquidity events that mint new high net worth individuals.

While the M&A market retained momentum this year, growth was driven by a rise in high-value outbound sovereign wealth fund deals from Singapore, aided by domestic activity in the region.

Globally, merger and acquisition activity this year held steady from the levels chalked up in 2017, the report said. Deal values stood at $3.5 trillion, with 39,651 transactions, it said.

Singapore recorded a total of 857 deals (M&A, PE/VC and IPOs) worth $106.2 billion for 2018 as compared to 842 deals worth $101.9 billion for 2017. M&A comprised the bulk of the deal volume in Singapore, constituting 688 deals valued at US$99 billion in 2018, compared to 698 deals valued at $75.4 billion in 2017.

Among M&A deals, standouts included San Miguel Corp’s acquisition of Masin-AES Pte for $1.9 billion, ESR-REIT’s merger with Viva Industrial Trust for $1.1 billion, Ho Bee Land’s property acquisition in the UK for $863 million, and Capitaland’s acquisition of a multifamily property portfolio in the US for $835 million.

In 2018, there were a total of 458 cross-border M&A deals in Singapore registering $89.1 billion. The bulk of total deal value came from 315 outbound transactions (Singapore-based companies or SWFs acquiring overseas companies) worth $81.1 billion contributing to over 82 per cent of the total deal value in 2018 for M&A deals. Domestic transactions contributed to 10 per cent of total M&A deal value.

Banking, financial services and insurance was the largest sector for M&A deals in Singapore.

Indonesia, Malaysia
M&A activity in Indonesia reached a record of $15.1 billion in deal value in 2018 compared to $6.6 billion in 2017, driven by large transactions in the materials, BFSI and energy sectors.

Malaysia clocked up total deals in M&A, PE/VC and IPO valued at $12.5 billion in 2018 compared to the record levels last year with deal values at $20.3 billion. Duff & Phelps said the figures “could be due to political changes and businesses taking a wait-and-watch approach on strategic growth initiatives”.

The report said Malaysia’s transaction momentum has picked up toward the end of the year with a few notable transactions in Malaysia’s Healthcare sector, such as the acquisition by Mitsui & Co Ltd of a 16 per cent stake in IHH Healthcare Bhd for $2.0 billion.