Dealmaking in region at a high this year

A total of 1,420 M&A, PE/VC and IPO deals were recorded in Singapore, Malaysia and Indonesia. 842 were recorded in Singapore.
A total of 1,420 M&A, PE/VC and IPO deals were recorded in Singapore, Malaysia and Indonesia. 842 were recorded in Singapore. PHOTO: ST FILE

Overall transaction value driven by rise in private equity buyouts

Dealmaking in Singapore, Malaysia and Indonesia saw a high from December last year to this November compared with two years ago, with Singapore accounting for the bulk of deal volumes.

An annual round-up of mergers and acquisitions (M&A), private equity and venture capital (PE/VC) and initial public offering (IPO) deals by global valuation and corporate finance adviser Duff & Phelps found that the overall transaction value in the three countries saw a high of more than US$130 billion (S$175.3 billion), exceeding the last high of US$115 billion in 2015. This was driven by a significant increase in PE buyouts, Duff & Phelps said.

"Deal values in 2017 in the region going above the 2015 highs show increasing confidence level of companies in the region, which have started looking at the world as their global market for acquisitions."

From last December to November this year, a total of 1,420 M&A, PE/VC and IPO deals were recorded in Singapore, Malaysia and Indonesia, with over 20 transactions valued at more than US$1 billion each.

Singapore recorded the majority, with 842 deals worth US$101.9 billion for the period in 2017, compared with 800 deals worth US$88.1 billion in the same period last year.

M&A comprised the bulk of the deal volume in Singapore, constituting 698 deals valued at US$75.4 billion in 2017, compared with 684 deals valued at US$82.7 billion last year.

M&A deal values continued to be driven by sizeable outbound M&A transactions by sovereign wealth funds, GIC and Temasek Holdings in consortiums, along with other notable M&A deals including Mitsui Sumitomo Insurance's acquisition of First Capital Insurance and Mapletree Investments' acquisition of US student housing assets.

  • US$130b

    Overall transaction value in Singapore, Malaysia and Indonesia from last December to November this year, exceeding the last high of US$115 billion in 2015.

  • 1,420

    Total number of M&A, PE/VC and IPO deals recorded in Singapore, Malaysia and Indonesia.

  • 842

    Of the deals were recorded in Singapore.

In Singapore, although the number of M&A deals increased to 698 between last December and November this year from 684 in the same period the year before, the value of the deals dropped about 8.8 per cent. The same trend was noted for the period December 2015 to November last year, when deal values fell about 18.2 per cent but volume increased 15.8 per cent.

On whether this trend will continue for the next few years, Ms Srividya Gopalakrishnan, managing director, Duff & Phelps, said: "Generally, we are seeing healthy transaction activity, based on what we see in the market. The activity will be robust."

Malaysia has seen strong momentum in deal activity, with total deals in M&A, PE/VC and IPO valued at US$20.3 billion from last December to November this year compared with US$15.6 billion in the same period a year ago. This is the highest deal value recorded in the last five years, Duff & Phelps said.

Deal activity in Indonesia has maintained similar levels for this year, with total value at US$9.6 billion, driven by sizeable transactions in the technology, materials and agriculture sectors.

Correction note: An earlier version of the story stated that Duff & Phelps' managing director is Mr Srividya Gopalakrishnan. This is incorrect. It is Ms Srividya Gopalakrishnan. We are sorry for the error.

A version of this article appeared in the print edition of The Straits Times on December 18, 2017, with the headline 'Dealmaking in region at a high this year'. Print Edition | Subscribe