Connect with us


Despite Covid-19, why is M&A booming in South-East Asia?

A global survey of more than 2900 C-suite executives, published by multinational consultancy EY in May, found that 47% of South-east Asian respondents would actively pursue M&A in the coming 12 months, above the 10-year average of 43%

Oxford Business Group



While the coronavirus pandemic has had a negative impact on many businesses throughout 2020, a recent rebound in mergers and acquisitions (M&A) has pointed towards a partial recovery in investor sentiment – as well as demonstrating that certain sectors have taken on greater importance as a result of Covid-19.

During the third quarter of the year more than $1trn of M&A transactions were conducted globally, according to statistics from financial market data provider Refinitiv.

These results represent a rise of 80% from the previous quarter, during which the virus-related disruptions to mobility and trade brought much business activity to a standstill.

67% spike in the Asia-Pacific region

Broken down regionally, M&A activity in the US increased three-fold to total $414bn in the third quarter, while it spiked by 67% in the Asia-Pacific region to reach $274bn; and 21% in Europe to reach $231bn.

The data revealed that much of the M&A activity has been concentrated in virus-resilient industries such as tech and health care.

Given the importance of such sectors during the pandemic, many investors and large corporations have moved to re-evaluate their strategic plans and look for new opportunities.

However, despite this rebound, the value of transactions over the first nine months of the year – $2.2trn – was still 21% lower than the same period in 2019.

Asia bucks the trend

Despite a 15% year-on-year (y-o-y) fall in global cross-border M&A over the first nine months of the year, according to UNCTAD – the UN’s trade body – the situation in Asia looks very different, with activity rising by 60% (y-o-y) over the period.

“Hotels and hospitality is one area where I see the potential for significant M&A activity. Bangkok and the major resort areas [in Thailand] have a lot of hotels that have been closed for several months due to the pandemic and not all of them will have the financial capacity to weather this sudden downturn,” 

 Paul Ashburn, co-managing partner at business consultancy BDO Thailand

While there had been a fall in overall investment in the region in the early part of the year – as OBG reported in July – there was significant appetite for expansion and consolidation.

Indeed, a global survey of more than 2900 C-suite executives, published by multinational consultancy EY in May, found that 47% of South-east Asian respondents would actively pursue M&A in the coming 12 months, above the 10-year average of 43%, while three-quarters said they were anticipating an increase in competition for assets within the next year.

Summing up the situation, UK-headquartered law firm Bird & Bird described M&A as the “perfect marriage” between financially strapped start-ups in South-east Asia and larger companies looking for cheaper strategic investments.

Given the increased demand for digital platforms and delivery services throughout the early months of the pandemic, it is perhaps not surprising that the sector has experienced attention from investors.

For example, in February the Singapore-based ‘super app’ Grab announced the purchase of wealth-tech start-up Bento, while Grab’s biggest rival in South-east Asia – Indonesia’s Gojek – acquired Indonesian point-of-sale start-up Moka in April and Vietnamese e-payment start-up WePay in September.

Elsewhere in the food delivery sector, in July the delivery app Line Man, owned by Japan’s Line Group, announced a merger with Thai restaurant review platform Wongnai after securing $110m in financing from BRV Capital Management.

Aside from sectors that have been successful during Covid-19, investment opportunities are also expected to emerge in underperforming companies that have struggled in recent months.

With some of the industry’s most experienced analysts conducting on-the-ground research throughout the year, OBG provides its global readership with the business intelligence they need to stay ahead.



APAC corporates likely to improve in 2021

Moody’s Investors Service says in a new report that credit conditions in APAC will improve in 2021, supported by the gradual recovery of economic activity given the early containment of the pandemic in several Asian economies.

Pr News




Ongoing fiscal and monetary support in both advanced and emerging markets will also aid improving conditions, but renewed lockdowns in parts of the world have stalled the nascent global economic recovery and create uncertainty around improving credit conditions.

Continue Reading


Thai Firm to produce 200 million doses of Covid-19 vaccine

Thai Firm Siam Bioscience Joins with AstraZeneca to Make COVID-19 Vaccine for Southeast Asia and says it will produce 200 million doses of its anti-coronavirus vaccine in Thailand next year.

Olivier Languepin



Thailand aims to vaccinate up to half of its population against Covid-19 next year according to the director of its National Vaccine Institute, Dr. Nakorn Premsri.

Continue Reading


Great Wall Motor (China) takes over GM factory in Thailand

The Thai production hub will become operational in the first quarter of 2021 with automobile production capacity of 80,000 units per annum.




Chinese carmaker Great Wall Motor (GWM) hosted a ceremony on November 2nd to celebrate the latest milestone in taking full ownership of Rayong Manufacturing Facility in Thailand.

Continue Reading


Most Viewed

Subscribe via Email

Enter your email address to subscribe and receive notifications of new posts by email.

Join 13,608 other subscribers