HONG KONG : Dealmaking in Southeast Asia and private equity transactions should help lift Asian mergers and acquisitions activity in the second half of the year, bankers said, after deals volume in the first half slumped to the lowest in a decade.
In Asia, the slump in activity has been driven by a sharp drop in China-related dealmaking due to deteriorating Sino-U.S. relations and a slower-than-expected recovery in the world's second-largest economy. "It has directed some Western flows of FDI into India and Southeast Asia, while increasing domestic reinvestment through re-shoring and near-shoring of production facilities," Choe added.
"Southeast Asia activity is still being driven by domestic consolidation in sectors such as financial institutions and TMT ," said Rohit Chatterji, co-head of M&A, Asia Pacific, at JPMorgan. Multinationals reshaping their strategy, particularly in oil and gas, and deciding to consolidate or exit certain assets in favour of national champions could also drive deals in Southeast Asia, said Chatterji.