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North Asia M&A: Towards technological convergence

North Asia M&A: Towards technological convergence

23 March 2017

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Mergermarket is pleased to present North Asia M&A: Towards technological convergence, published in association with Merrill Corporation.

Five years of roaring M&A growth may finally have found its ceiling as deal totals for acquisitions in North Asia settle into more modest territory, in a year marked by volatility and uncertainty across the globe.

At the close of 2016, North Asian deal values had dropped sharply from US$765bn in 2015 to US$533bn, a year-on-year decline of 30%, with a less noticeable drop of 3% in deal volume. Similar declining deal figures have become a feature of individual key economies across North Asia (China, Hong Kong, Macau, South Korea, Japan, Mongolia and Taiwan) as the market begins to steadily rebalance toward more sustainable growth rates.

Via an in-depth interview, Marshall Nicholson, Managing Director and Head of Equity Capital Markets at Nomura’s Asia ex-Japan Investment Banking Division, shares insights on charting a path towards deal success.

Key findings include:

  • Inbound declines: North Asia saw foreign inbound M&A continue on a two-year decline with only 180 transactions worth US$35bn in 2016, compared to 190 transactions worth US$41bn in 2015, registering declines of 15% by value and 5% by volume.
  • Outbound shopping sprees: Globally, China’s outbound acquisition push has reached new heights with 372 deals valued at US$208bn, an increase of 120% in deal value and 19% in deal volume. Japan’s appetite for outbound acquisitions remained strong in 2016, with 317 deals worth US$92.7bn, an increase of 4% by volume and 6% by value.
  • Top sectors: The industrials & chemicals and TMT sectors continue to buttress overall deal figures in North Asia, the two accounting for almost half of acquisition volumes and 40% of values.

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