The value of announced M&A deals involving Asia Pacific companies, excluding Japan, totaled US$510.0 billion so far this year, down 3.3% from the full year volume in 2012 (US$527.5 billion), according to Thomson Reuters. This is the lowest annual level since 2009 when deal value was at $372.4 billion.
The average M&A deal value for disclosed deals grew to $81 million as compared to US$73 million in 2012.
This year, deal-making involving Asia Pacific companies witnessed only four transaction above the $5-billion range compared to last year’s seven deals $5-billion-above.
Completed M&A activity involving Asia Pacific amounted to $315.1 billion thus far, a 24.7% decline from the comparative period in 2012 ($418.2 billion) as number of completed deals fell 21.1% to 5,227.
China Remains Most Targeted Nation
M&A transactions targeting Asia Pacific reached $416.3 billion to date, a 2.1% increase compared to last year ($407.7 billion), and the highest annual period since 2011 ($442.2 billion). Asia Pacific-target M&A during fourth quarter of 2013 stood at $120.0 billion, up 7.9% in deal value from the third quarter of 2013, and witnessed its third consecutive quarterly increase this year.
Chinese companies continued to be the preferred target nation by both domestic and foreign acquirers with $191.4 billion, up 25.6% in deal value, and captured 46.0% of Asia Pacific-target M&A activity this year.
Real Estate Sector Takes the Lead with 17.9% Market Share
The Real Estate sector witnessed its best annual period on record and captured 17.9% of the acquisitions involving Asia Pacific companies (in terms of deal value) this year driven by Westfield Retail Trust's $14.0 billion offer for the Australian and New Zealand businesses of Westfield Group. The deal is the biggest ever real estate acquisition involving Asia Pacific companies, thus pushing the value of Real Estate acquisitions to $91.2 billion, a 59.7% increase from last year.
Meanwhile, acquisitions in the Energy & Power followed second place with $80.9 billion and captured 15.9%
of M&A activity involving Asia Pacific companies as deal value fell 11.2% from last year.
Private Equity-backed M&A Drops 17.7%
Buyside Financial Sponsor M&A activity in Asia Pacific reached $23.7 billion so far this year, a 17.7% decrease from 2012 ($28.8 billion), and witnessed the lowest annual period since 2009 ($14.4 billion).
China accounted for 35.2% of the private equity-backed M&A activity in Asia Pacific this year in terms of deal value with $8.3 billion, down 26.6% from last year. South Korea (26.1% market share) and Australia (15.7% market share) followed after China with a 2.8% and 9.2% increase in deal value from 2012, respectively.
Private equity-backed M&A in the region’s High Technology sector registered 26.5% of the market share worth $6.3 billion and witnessed a 181.7% growth in deal value from the comparative period in 2012.
Completed M&A Advisory Fees Down 19.4%
According to estimates from Thomson Reuters / Freeman Consulting Co., M&A advisory fees from completed deals in Asia Pacific reached US$1,729.6 million so far this year, down 19.4% compared to the same period in 2012.
Morgan Stanley currently takes the lead in the M&A imputed fees ranking on advisory work for completed M&A deals in Asia Pacific, with $108.3 million in related fees, and captured 6.3% of the market share.