HORIZONS | BDO'S GLOBAL VIEWOF MID-MARKET DEAL ACTIVITY 49
SOUTH EASTASIA DEAL FLOW SLOWS INQ4 BUT OVERALL 2021 M&A DEAL-MAKING HOLDS UPWELL
M&A activity in South East Asia took a surprise downturn in Q4 2021 with deal volume hitting a yearly low, with just 31 deals completed compared to 99 deals recorded in Q3 2021. However, on an aggregate basis, the deal volume of 274 for the cumulative four quarters in 2021 was slightly higher than the 260 deals that took place over the same period in 2020. Total deal value in South East Asia in Q4 2021 also decreased by 51.1% from USD 9.0bn in Q3 2021 to USD 4.4bn in Q4 2021. However, on an aggregate basis, the deal value for the cumulative four quarters in 2021 increased by 42.1% to USD 27.0bn from USD 19.0bn for the cumulative four quarters in 2020, indicating the higher value of transacted deals. Overall, M&A mid-market deal-making activities in 2021 performed better than 2020, largely on the back of improving economic conditions across the region, falling numbers of COVID-19 cases and the relaxation of lockdown measures. The drop in deal volume and value in the final
quarter may be partly due to the higher number of deals completed in the first three quarters of 2021, which saw 243 transacted deals compared to 184 in the corresponding period in the previous year. PE has emerged as an increasingly important factor in South East Asia’s M&A activity, with deal volume increasing from 29 deals for the cumulative four quarters in 2020 to 64 deals for the same period in 2021. Similarly, total deal value increased by 151.6% from USD 3.1bn for the cumulative four quarters in 2020 to USD 7.8bn for the same period in 2021. The overall deal volume and value for PE activity in 2021 were the highest recorded since 2008. PE accounted for 23.4% and 28.9% of total deal volume and value respectively in 2021, the highest contribution since 2008. This trend demonstrates the growing significance of PE M&A in South East Asia. KEY SECTORS AND DEALS TMT was the top performing sector in terms of deal volume, with eight transacted deals that represented 25.8% of the quarter’s deal count.
BIG PICTURE
• Deal volume and value fall in final quarter but 2021 deal numbers were up compared to 2020 • PE deal volume and value soared to 13-year high • TMT accounted for 25% of all deals in Q4 2021.
PE/TRADE VOLUME &VALUE
120
10,000
9,000
100
8,000 7,000 6,000 5,000 3,000 2,000 1,000 4,000
80
60
40
20
0
0
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Trade Volume
PE Volume
Total Value (USD M)
PE Value (USD M)
Made with FlippingBook HTML5