(March 25): Private equity deals in Asia-Pacific are showing signs of recovery, with transaction volumes in the region climbing 11% to US$176 billion (RM781.31 billion) last year and looking set to pick up further, according to global consultancy firm Bain & Co.

Deals in 2024 were larger, with buyout transactions accounting for more than half, Bain said in a report released on Tuesday.

The share of buyout deals rose in markets which are traditionally more focused on growth transactions such as India, Southeast Asia and Greater China, the report showed.

Private equity deals in Asia-Pacific last year included Blackstone Inc’s purchase of Australian data-centre operator AirTrunk in a deal valuing the firm at US$16 billion, including debt and capital expenditure for committed projects.

While far from the peak levels of private equity merger and acquisition activity seen in 2021, things are heading in the right direction and there is some improvement, Sebastien Lamy, a co-head of Asia-Pacific private equity practice at Bain, said in an interview.

“We expect private equity-led deals to softly pick up this year, and perhaps even accelerate into the next couple of years,” Lamy said. “Financial sponsors — both global and regional — have been recalibrating their China exposure and investing elsewhere in Asia and beyond.”

Carve-out deals represent a top investment opportunity, particularly in Japan and South Korea, as conglomerates streamline operations and sell off business units, Bain said in the report.

Geopolitical concerns remain a key hurdle to getting deals done, Lamy said, adding that private equity firms are worried about macroeconomic and market volatility, as well as uncertainty over interest rates.

Uploaded by Jason Ng