APAC’s M&A landscape in 2026 is proving that confidence comes from clarity.

After a blistering start to 2025 – when Asia-Pacific deal value nearly doubled year-on-year despite fewer deals – momentum cooled in Q3 as buyers paused to digest earlier transactions. Yet across these swings, a common thread ran through the region’s M&A markets. According to Datasite’s Deal Drivers series of M&A market spotlight reports, deals consistently clustered where policy visibility, governance quality, and sectoral tailwinds converged.

Policy tailwinds and macro stability

Across APAC, governments have taken steps to lower the dealmaking risk premium. The late-2025 tariff truce between the US and China removed a major overhang on export-focused industries. Likewise, selective interest rate cuts and fiscal support in markets such as Indonesia, Thailand, and the Philippines have shored up economic confidence. The result is improved visibility on trade and financing conditions. Buyers can underwrite valuations with greater certainty around supply-chain costs and currency stability.

While 2026 growth is forecast to moderate slightly (IMF projects ~4% regional GDP growth, down from 4.5% in 2025), APAC’s expansion remains enviably high. That steady backdrop has put wind in the region’s sails, helping dealmakers focus on fundamentals instead of macro anxieties. In short, clearer skies on the policy front are renewing risk appetite among investors and acquirers.

Governance readiness as a deal catalyst

The quality of corporate governance is emerging as a make-or-break factor for M&A success. Nowhere is this more evident than in Japan, where Tokyo Stock Exchange reforms and pressure on boards have unlocked a wave of divestitures. An endless supply of carve-outs is coming to market as conglomerates streamline portfolios, and both domestic and global private equity are eager to pounce on these assets. Why? Governance reforms have led to cleaner financial disclosure, more management openness, and generally “ready-to-sell” business units, giving buyers confidence that deals won’t unravel in diligence.

Across the region, a similar pattern holds: companies that are well-prepared, transparent, and aligned with regulatory expectations draw far stronger interest. Conversely, those with opaque finances or governance red flags struggle to get deals across the finish line.

Sector concentration and value hotspots

Rather than a uniform recovery, APAC M&A is pocketed in specific sectors where structural growth and policy priorities intersect. Technology, media & telecom (TMT) remains the busiest sector by deal count, as digital transformation and AI infrastructure investments continue unabated. Industrials & chemicals (I&C) is similarly robust, bolstered by manufacturing realignment and demand for advanced materials (from semiconductors to EV batteries). Notably, financial services M&A saw outsized value in 2025, buoyed by state-backed bank recaps in China and consolidation plays elsewhere.

And after a quiet 2024, pharma, medical & biotech (PMB) came roaring back in 2025 with a 45% jump in deal value, as stricter compliance standards put a premium on high-quality drug manufacturers and medtech targets. The commonality? Deals are flowing to sectors with tailwinds – whether government investment, innovation cycles, or supply-chain advantages – while more cyclical or stagnant industries lag.

Pipeline momentum leading into 2026

Forward-looking indicators support these trends:

• Greater China currently accounts for the largest share of APAC’s pipeline of potential deals (roughly one-third of all “for sale” candidates) – especially in industrials, technology, and related sectors that align with national strategic priorities. This pipeline strength suggests that China will continue to anchor regional deal flow, fueled by both domestic SOE consolidation and inbound interest (foreign acquirers poured over US$50bn into China deals by late 2025 – a post-2008 high).
• Australia & New Zealand together are a close second after China, thanks to critical minerals and energy transition opportunities. The key takeaway is that deal pipelines are deepest where long-term growth stories are intact.
• Southeast Asia, while smaller in aggregate, boasts the third-largest deal pipeline in the region (~188 prospective deals), spanning a broad mix from manufacturing to fintech.
• India benefits from demographic tailwinds and fast-growing TMT and healthcare activity.

Dealmaker success in APAC will hinge on finding the clear paths – where policies are stable, governance is solid, and growth stories are convincing – and executing with discipline. By applying the strategies above, deal teams can turn a challenging market into an opportunity. The right preparation, focus, and technology can tilt the odds in your favor when it comes to closing the deal.