Local Spotlight: Deal Drivers in SE Asia & India - Pulse of the Market

By Robert Torio, Content Marketing Manager, APAC

Part 1 of a two-part blog series featuring insights from the Deal Drivers: Southeast Asia & India – M&A in H1 2020 and beyond webinar hosted by Datasite and Mergermarket

On the back of a strong M&A record in 2019, Southeast Asia saw a strong start in Q1 2020 with a total deal value of US$ 25.1bn. Meanwhile, despite dominating the largest PE transactions in Q1, India experienced a 30.4% drop in M&A in 2019, there was an expectation of a strong 2020 lead by the government of India encouraging disinvestments.

M&A deal flow has experienced a slowdown in the two regions because of the COVID-19 crisis, and the outlook remains uncertain.

Recently, 400+ dealmakers across SE Asia and India joined a live virtual briefing led Riddhima Saxena, Emerging Markets Editor at Mergermarket and engaged with our expert panelists:

• Ajay Arora, National Leader and Head of Investment Banking Advisory, Ernst & Young
• Pankaj Goel, Managing Director, Credit Suisse
• Gunjan Shah, Partner, Shardul Amarchand Mangaldas
• Sze Shing Tan, Principal, Baker McKenzie Wong & Leow
• Desmond Chua, Head of Region, APAC, Datasite

Market sentiment: Most dealmakers are keeping a positive outlook

How corporates in India and across SE Asia perform during this crisis is yet to be ascertained; however, some bright spots are emerging in new-age sectors in the two regions as these economies remain underserved.

We asked dealmakers in both regions and more than half remain positive about M&A activity in the coming months. Our panelists have a similar outlook as well.

M&A to dominate activities and transactions

It is expected that corporates will focus on preserving liquidity and restructuring going forward and exploring private equity strategies which will evolve in the current environment. While 22% of dealmakers at our recent webinar believe mergers will dominate in the coming months, 40% think that asset purchase/sales would be more prevalent.

Technologies that help M&A adapt to the new normal

Dealmaking can be a travel-heavy pursuit with executives flying around the world for meetings, site visits, and due diligence. How are dealmakers closing deals while working from home? As economies across SE Asia and India are easing lockdowns in some areas, how are they are preparing to resume or ramp up dealmaking once more?

Dealmakers continue to embrace technology that can help them execute more successful deals. Almost 80% say the capability to complete due diligence virtually or remotely is the most important aspect of M&A technologies in the current situation.

End of Part 1

Watch this space for Part 2 of this two-part series, featuring expert insights from our panellists.