Tech deals drive M&A activity to record high in Asia Pacific, show Dealogic data

Mergers and acquisitions targeting technology companies have hit a record high in Asia Pacific, Dealogic data shows, and dealmakers expect this M&A pace to continue as the pandemic spurs a shift toward virtual activities in the economy.

Tech M&A has totalled $136.2 billion in 2020, more than double the year-ago levels, according to data provider Dealogic.

Tech deals accounted for 28% of the regions’ overall M&A transactions, which totalled $482.4 billion as of Wednesday, the highest share in at least a decade, the data shows.

This boom “is a result of technology changing the way our economy works”, said Jung Min, co-head of M&A and Technology, Media and Telecom at Goldman Sachs in Asia (ex-Japan). “For a consumer, it affects how you shop, pay, eat, move and entertain. For a business, it affects how you recruit top employees, source your supply chain, manufacture and, of course, sell to customers,” he added.

For businesses to ensure they have the required scale to win in this environment, M&A is “transformational”, he said.

Corporate executives are also bullish on the sector, a survey by law firm Baker McKenzie shows.

The survey of 800 senior executives in Asia Pacific shows over three quarters of the respondents predicting tech deals would increase markedly in the next 12 months.

In the survey, conducted in the first quarter and published on Thursday, 92% said technology, media and telecoms companies would drive their own deal activity, while 57% said they would acquire new technology and associated expertise.

“This signals major consolidation across the tech sector, as fast growth companies snap up rival firms and complementary platforms, and move into new markets,” the report said.

In April, Grab Holdings, the largest ride-hailing and food delivery firm in Southeast Asia, went public in the world’s biggest $40 billion merger with a special purpose acquisition company.

Grab’s rival Gojek and e-commerce leader Tokopedia have also announced a merger to create a multi-billion dollar tech company in Indonesia’s largest-ever deal.

Mega deals in the pipeline also include a possible take-private of Japan’s Toshiba Corp.

Toshiba has hired UBS to advise on a strategic review, amid calls from shareholders to explicitly seek offers from potential suitors after it dismissed a $20 billion take-private bid from CVC Capital this year.

Reuters

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.