Asia ex Japan M&A Report – December 2017

Gains recorded in M&A deals targeting Asia ex Japan in November were pared in December.

　The volume and value of mergers and acquisitions (M&A) deals targeting companies based in Asia, excluding Japan, fell to 1,571 deals worth a combined USD 91,892 million in December as dealmaking failed to sustain the rebound that had resulted in 1,965 deals totalling USD 109,197 million in November.

　While volume slipped by a fifth month-on-month to a new 12-year-low in December, value remained robust, despite a 15 per cent decline, due to 16 deals announced over the four weeks, each of which were worth more than USD 1,000 million.

　In a year-on-year comparison, volume was down by 43 per cent from 2,741 deals in December 2016 and value by 19 per cent from USD 113,353 million

Vietnamese privatisation was December’s largest deal

　While Chinese companies were the most prolific deal-makers in December, the privatisation of a 54 per cent stake in Saigon Beer Alcohol Beverage accounted for the month’s largest deal by value after the local unit of ThaiBev, Vietnam Beverage, won the auction to acquire the majority interest in the state-owned enterprise for USD 4,843 million.

　The second-biggest deal of the month involved Reliance Jio Infocomm buying Reliance Communications’ mobile tower and fibre optic network assets for USD 3,743 million, which marginally edged ahead of the USD 3,438 million purchase of a 74 per cent stake in Bank Danamon Indonesia by Bank of Tokyo-Mitsubishi UFJ.

　Chinese targets dominated the top 20 deals by value, though companies based in Vietnam, India, Indonesia, Singapore and Hong Kong all featured first, ahead of Bank of Ningbo’s capital increase worth USD 1,512 million.

Top Deals in Asia ex Japan Markets by Deal Value (USD million) in December 2017

South Korea overtook India by volume and vice versa by value, though they still lagged behind China

　Companies in China were the most prolific deal-makers in December, having been targeted in a total 956 deals worth a combined USD 49,325 million, representing a decline of 14 per cent by volume from 1,111 and 27 per cent by value from USD 67,845 million in November.

　South Korea overtook India by volume month-on-month after companies based in the country were targeted in 238 deals valued at an aggregate USD 9,515 million, representing the second consecutive monthly increase by both volume and value.

　On the other hand, there were only 65 Indian deals totalling USD 13,235 million in December, indicating inbound acquirors preferred single, higher valuations over prolific deal-making with smaller aggregate valuations, such as USD 1,000 million-plus deals for Reliance Communications’ mobile tower and fibre optic network assets, HDFC Bank and Housing Development Finance Corporation.

　Report notes

　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”.