Asia-Pacific Private Equity Deals Hit All-Time High in 2014

A report released by global management consulting firm Bain & Company showed that private equity (PE) deals signed in the Asia-Pacific region reached USD81 billion in 2014, an all-time high.

The last time PE deals in Asia hit a record high was in 2007, when deal value reached USD77 billion, Bain said.

The number of deals also went up 14 percent to 742 last year, with the average deal size grew to USD110 million from USD77 million in the previous year.

Most of the region’s PE investment growth came from China, which had six mega-deals worth more than USD1 billion last year. China’s deal value reached USD41 billion in 2014, up 33 percent from the previous peak in 2011.

For Southeast Asia, Singapore led the PE activity with two mega-deals worth USD2.3 billion, pushing the Southeast Asia’s overall investment value to USD5.9 billion.

Meanwhile, industry research firm Preqin said global venture capital (VC) investments hit a record in Q1 this year after rising 50 percent to USD27.4 billion year-on-year.

But while investments went up, the number of companies receiving VC investment globally decreased 6 percent to 1,701 from 1,817 in Q4. This means the average size of deals has grown significantly, with series D round deals or later recording average deal size of over USD100 million for the past six months.

Seed financing was up 25% in 2014 while dry powder investment stands at USD132 billion from USD121 billion at the start of 2015.

Christopher Elvin, head of private equity products at Preqin, expects VC deal activity to remain strong for the entire 2015.

“Managers still have significant amounts of capital to deploy, and with many innovative companies vying for investment worldwide, deal activity is likely to remain strong in 2015,” Elvin said. – BusinessNewsAsia.com

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