UK-based private equity behemoth Actis has a clear investment strategy: A focus on deals instead of a top-down view on any region or country.
“We are a global emerging market investor; we look across the globe for deals and settle on deals with the best relative risk-adjusted returns. Overall, China and India present a majority deal flow within Asia for all GPs, but that will change for various reasons – it could be driven by political risks, valuation, or competition in the markets,” Actis managing director and head of Asia of the investor development group Ellen Li told DEALSTREETASIA in an interaction.
From a geographic perspective, investors are seeing increasingly congested and competitive processes in developed markets with much of the US and Europe region being priced to perfection. “We look at things through a sector rather than the geographical lens – we see enormous opportunity in Asia in the sectors we focus on,” Li said.
As an investor in asset classes that include private equity, energy, infrastructure, and real estate, Actis increasingly focuses on ‘responsible investing’ that has three main elements: risk mitigation, value creation and license to operate. That, says Li, is the way forward, particularly for the Asian market.
“We have seen capital being raised under an ‘Impact’ banner. We have never self-identified as an Impact investor but as a responsible investor. With 70 years of heritage, we do recognize our responsibility to define and measure the positive impact of our investments. We have created an open-source framework to do just that,” Li added.
In a detailed conversation, Li highlighted what investors globally may be looking at, how the firm is seeing enormous opportunity in Asia in the sectors it focuses on, the exit scenario and the opportunity for larger deals that come with co-investing.