Overall M&A activity remains healthy in Asia-Pacific during Q4 2019, finds GlobalData

The Asia-Pacific (APAC) region witnessed growth in mergers and acquisition (M&A) deal volume and value during the fourth quarter (Q4) of 2019, according to GlobalData, a leading data and analytics company.

The number of M&A deals grew from 1,282 in Q4 2018 to 1,568 in Q4 2019, whereas the value increased from US$107.2bn to US$117.bn.

Some of the notable M&A deals announced during Q4 2019 include: the acquisition of 46.31% stake in Mitsubishi Tanabe Pharma by Mitsubishi Chemical for US$4.5bn, and the acquisition of Woowa Brothers by Delivery Hero for US$4bn.

The top six countries (China, Japan, Australia, India, Singapore and South Korea) by deal activity (by M&A deal value and volume in 2019) collectively accounted for around 80% of total volume and value in Q4 2019, with China occupying the top position, followed by Japan and Australia.

Aurojyoti Bose, Financial Deals Analyst at GlobalData, says: “The deal momentum within the region remains diverse among different countries with several parameters such as trade relations with other countries, political scenario and economic growth weighing heavily on M&A activity.”

Despite several challenges such as trade tensions with the US, the appetite for deal-making remains healthy in China. Japan also emerged as a bright spot for M&A activity within the region. On the other hand, slowing economic growth dented the M&A deal momentum in India.

Among all the top six countries, deal activity in India remained relatively sluggish with the country witnessing decline in overall deal volume as well as value in Q4 2019 compared to Q4 2018. South Korea was the other country to witness decline in overall deal value in Q4 2019, however it witnessed significant growth in deal volume.

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Despite an increase in total deal volume and value, the average deal size in Q4 2019 stood at US$74.8m, which was lower compared to the average deal size of US$83.6m in Q4 2018.

China, India and South Korea were among the key countries that witnessed significant decline in average deal size, with their average deal size declining by 38.1%, 57.7% and 60.5%, respectively, in Q4 2019 compared to Q4 2018.

Among these countries, India witnessed notable decline in the announcement of big ticket deals. Compared to the announcement of seven billion-dollar M&A deals in Q4 2018, the country witnessed the announcement of only one such deal in Q4 2019.

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