Asia ex Japan M&A Report – April 2018

　The following report details mergers and acquisitions activity in Asia ex Japan for the month of April 2018 using data from the M&A database.

Value of M&A in Asia, ex Japan, remained on an even keel in April

　There were 1,871 mergers and acquisitions (M&A) deals targeting companies based in Asia, excluding Japan, worth an aggregate USD 112,918 million in April, compared to 2,079 deals totalling USD 113,394 million in March, representing a 10 per cent decrease in volume and a marginal decline of less than half a per cent month-on-month.

　Value remained robust as it was supported by 19 deals each worth USD 1,000 million or more in April and which, together, accounted for half of the month’s total value. In a year-on-year comparison, value was up 45 per cent on the USD 77,723 million-worth of deals announced in April 2017.

　While volume fell back 13 per cent year-on-year, it was by no means the lowest recorded for the 12 months under review (February: 1,552; October: 1,782). The decline suggests acquirors and targets opted for individual deals with higher valuations, rather than prolific deal-making with lower aggregate valuations.

Chinese targets dominated the top 20 in April

　All bar one of the top 20 deals by value targeting companies based in Asia, excluding Japan, were worth USD 1,000 million or more in April, with three of these M&A deals topping USD 5,000 million.

　Chinese targets dominated the top 20 deals and accounted for the largest and third-biggest deals of the month: Bank of Communications announced plans to issue convertible bonds worth an aggregate USD 9,469 million, while Alibaba Group Holding and affiliate Ant Financial bought the remaining 57 per cent stake not already owned in Shanghai Lazhasi Information Technology, an online food delivery start up that trades as Ele.me, for USD 5,415 million.

　An Indian deal was the only other M&A deal worth more than USD 5,000 million as Bharti Infratel has decided to start the process of acquiring the 58 per cent balance in Indus Towers from Vodafone.

　There were only two other deals in the top 20 that did not feature a target based in China or India; Singaporean sovereign wealth fund GIC and other investors bought stakes in two subsidiaries of Vingroup, one of which was Vinhomes, for USD 1,300 million, and Elliott Management announced it has acquired stakes in Hyundai Motor, Kia Motors and Hyundai Mobis worth more than an aggregate USD 1,000 million.

Top Deals in Asia ex Japan Markets by Deal Value (USD million) in April 2018

Chinese targets propped up April’s M&A

　China was once again the main target country of M&A in April as companies based in the People’s Republic announced 1,188 deals valued at USD 81,412 million over the four weeks, compared to 1,260 deals totalling USD 77,052 million in March. Deals announced by Chinese companies in April accounted for 63 per cent of the month’s total volume (1,871) and 72 per cent of overall value (USD 112,918 million).

　Indian targets were next by value after doubling deal-making from USD 6,585 million in March to USD 15,213 million in April, of which Indus Towers accounted for 41 per cent of the total, followed by South Korea (USD 5,308 million). However, in terms of volume, the 127 deals announced by Indian companies in April was surpassed by the 211 deals announced by South Korean companies.

　An increase in the value of M&A in the country, India, Hong Kong, Vietnam, Indonesia, Thailand, Kazakhstan and Bangladesh over the four weeks came at the expense of deal-making targeting companies based in South Korea, Taiwan, Sri Lanka, Cambodia and Kyrgyzstan, among others.

　Activity is based on the activity of the target company.

　Deal status is announced within the time period.

　The sector breakdown uses targets’ activities as defined to be ‘Major Sectors’ by Zephyr.

　You are free to use any data or commentary from this report in your articles as long as the source is cited as “Zephyr published by Bureau van Dijk”.