The comprehensive review of mergers and acquisitions in the … · 2020. 8. 13. · provide bright spots of deal activity for the sector. Across all sectors, East Asia, which includes

The comprehensive review of mergers and acquisitions in the Asia Pacific region

Deal DriversAsia Pacific

HY 2020

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Contents

Foreword 04

Asia-Pacific Heat Chart 05

All Sectors 06

Financial Services 17

Industrials, Manufacturing & Engineering 23

Energy, Mining, Oil & Gas 29

Consumer 35

Technology, Media & Telecom 41

Life Sciences & Healthcare 47

About Datasite 54

The comprehensive review of mergers and acquisitions in the Asia Pacific region throughout the first half of 2020.

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Mergermarket 3HY 2020Contents



Foreword

Desmond Chua Head of Region, APAC Datasite

Welcome to the half-year 2020 edition of Deal Drivers APAC, published by Mergermarket in association with Datasite. This report provides an overview of deal activity in the APAC region over the first six months of 2020 and looks into how the COVID-19 pandemic has affected merger and acquisition activity during the year as well as how the region is positioned going into the second half of 2020.

APAC was the first region that had to contend with the coronavirus outbreak and the impact of lockdown measures on the economy and on M&A activity. Despite a rebound following the lifting of restrictions, the Asia Dow stock market index is still in the red for the year thus far, and the IMF is forecasting that Asia’s economy will contract by 1.6% in 2020.

Deal activity has inevitably slowed against this uncertain and volatile macro-economic backdrop, yet the drop in both value and volume in the region was far less steep than the global figures.

In the APAC region, total deal value for H1 2020 has dropped 12% compared to the same period the year before, to US$255.1bn, while volume fell 13% to 1,744 deals. In contrast, global M&A value collapsed by 53% year-on-year and volume fell 32% over the same period.

Private equity, meanwhile, saw bigger declines in activity—despite sitting on a record US$388bn worth of dry powder, according

to Bain & Co—as firms put new activity and exits on hold to see how the response to the pandemic developed. H1 2020 buyout value and volume fell to US$124.4bn and 886 deals respectively, from H1 2019’s totals of US$266.1bn and 1,227 deals—declines of 53% by value and 28% by volume. Exit activity fell even further: value dropped 54% year-on-year to US$74.4bn, while volume fell 34% to 401 exits, from US$162.6bn and 607 exits.

East Asia—which includes the dominant economic hubs of the Greater China region and South Korea—delivered the bulk of the region’s deal value and volume, with 967 deals valued at US$141.5bn. South Asia was the next biggest region by deal value with US$46.7bn from 191 deals, followed by Southeast Asia with US$29bn worth of value from 154 transactions.

With respect to sectors, the region’s thriving technology, media & telecom (TMT) industry was the largest contributor to deal value by some distance with US$59.2bn worth of transactions, nearly double the size of the next largest sector by value, industrials, manufacturing & engineering (IME), with deals worth US$35.3bn. Financial services was the third biggest sector by value with transactions to the value of US$33.1bn.

The IME sector, despite being the second largest sector by total value, was nevertheless among the most impacted sectors. Deal value fell 54% from H1 2019’s total of US$77.3bn.

Among the other hard-hit sectors was the energy, mining, oil & gas sector, which recorded a 28% annual drop in deal value, which came to US$21.5bn in H1 2020. The consumer sector, which has been hit hard by lockdown measures and drops in discretionary spending, saw deal value fall 20% from year-to-year, registering US$22.2bn in deal value in the first six months of 2020.

After a tough first half, dealmakers will be hoping that activity stages a recovery in H2. Stock markets have certainly rebounded in Q2 and the IMF expects that the region’s key economies, including China and South Korea, will be well-placed to navigate the lifting of lockdowns and any second surges of the coronavirus.

There are, however, still challenges facing the region. Growing tensions between China and the West over issues including global trade, politics and the provision of 5G technology by Chinese technology group Huawei could weigh on activity, as could tighter rules on foreign M&A coming into force around the world.

M&A in the APAC region is positioned to rally through the rest of 2020 and 2021—nonetheless, it could be a bumpy recovery.

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Mergermarket 4HY 2020Foreword



Asia-Pacific Heat Chart

Heat Chart based on potential companies for sale

Note: The Intelligence Heat Charts are based on ‘companies for sale’ tracked by Mergermarket in the respective regions between 01/01/2020 and 30/06/2020. Opportunities are captured according to the dominant geography and sector of the potential target company.

Hot Warm Cold

200

160

120

80

60

40

20

10

1

Sector East Asia South East Asia Australasia South Asia Japan Central Asia Total

Industrials, Manufacturing & Engineering 416 39 38 25 37 1 556

Technology, Media & Telecom 265 76 83 55 43 522

Consumer 166 51 65 38 22 2 344

Business Services 146 46 33 23 28 276

Financial Services 96 57 36 31 7 1 228

Life Sciences & Healthcare 122 39 37 18 10 226

Energy, Mining, Oil & Gas 93 52 51 18 2 4 220

Construction 65 32 9 3 7 116

Leisure 58 22 14 13 6 113

Real Estate 64 22 8 3 7 104

Transportation 48 28 14 6 3 99

Agriculture 21 11 4 1 1 38

Other 4 6 2 1 13

Government 1 4 1 1 7

Defense 2 2

Total 1,567 485 395 236 173 8 2,864

Looking ahead to the next six months of APAC dealmaking, the industrials, manufacturing & engineering (IME) sector and the technology, media, telecom (TMT) sector can be expected to see the greatest level of activity, according to Mergermarket’s Heat Chart, which tracks “companies for sale” stories over the past six months.

There were 556 stories about IME firms coming to market on Mergermarket’s intelligence tool during this period, the majority of which — 416 — were in the East Asia region.

The TMT sector, which was the dominant one in the last full-year edition of Deal Drivers: APAC, has come in second place in this edition, with 522 stories of companies for sale across APAC. Just over half of these were in the East Asia region, although Australasia and Southeast Asia could also provide bright spots of deal activity for the sector.

Across all sectors, East Asia, which includes the Greater China region and South Korea, looks set to be the dominant M&A market in APAC by volume — with 1,567 “companies for sale” stories published about the region over H1, over half of the total such stories published in the region.

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Mergermarket 5HY 2020Heat Chart



All Sectors

Part of the Acuris reporton global M&A activity

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Mergermarket 6Deal DriversAsia Pacific

HY 2020All Sectors


All SectorsOverview

M&A around the world has witnessed a sizable impact due to the COVID-19 pandemic, and the APAC region is no exception.

Total M&A value in the first six months of 2020 came to US$255.1bn, compared to US$290.6bn in H1 2019 and US$371.9bn in H2 2019—a decline of 12% and 31%, respectively.

In terms of deal volume, there were 1,744 transactions in H1, down 13% from 2,009 transactions in H1 2019 and 28% below the 2,408 deals struck in H2 2019. Deal volume and value figures for Q2 this year, meanwhile, represent the weakest quarterly totals since Q1 2014.

The technology, media & telecom (TMT), industrials, manufacturing & engineering (IME) and financial services sectors proved the most resilient through COVID-19 from an M&A perspective, emerging as the three largest sectors by deal value.

TMT delivered 303 deals to the value of US$59.2bn, followed by IME with US$35.3bn from 337 transactions and financial services with 160 deals worth US$33.1bn.

Together these three sectors accounted for half of the overall deal value for H1 2020, as lockdowns saw activity in other usually popular sectors like consumer and construction contract sharply.

The TMT sector, however, has been the standout performer this year, with deal value actually increasing 40% from the US$42.1bn recorded over H1 2019. Six of the region’s 20 largest deals were in the TMT sector, which delivered some sizable transactions, such as Facebook’s US$5.7bn investment for a 9.99% minority stake in India’s Jio Platforms, a social networking platform owned by telecoms magnate Mukesh Ambani. Another standout TMT deal was the US$7.6bn private equity-led take-private of 58.com, a Chinese online classifieds business.

The IME sector was the next largest sector by value in the region, despite total value more than halving from H1 2019’s total of US$77.3bn. This was almost certainly due to a slump in deal activity at the top end of the market, as the drop in deal volumes for the sector was far less precipitous, falling only 19% to 337 deals.

Deal value in financial services, meanwhile, dropped by only 4% compared to H1 of last year, driven in part by restructuring and rescue deals in China’s banking sector. The second largest financial services deal in Asia, for example, saw Anbang Insurance sell a 35% stake in Chengdu Rural Bank in a US$2.4bn deal to local government-backed investment vehicle Chengdu Xingcheng Investment Group—part of a years-long restructuring of Anbang.

Consumer deal value slid from US$27.7bn in H1 2019 to US$22.2bn in H1 2020, even though H1 2020 deal value totals received a huge boost from grocer Tesco’s exit of its Thai business in a US$10.6bn sale to Charoen Pokphand Foods. The US$1.9bn take-private of Hong Kong’s global consumer goods logistics group Li & Fung was the only other APAC consumer deal to break the US$1bn threshold during H1 2020.

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HY 2020All Sectors


Top deals

Top 20 Announced Deals for Half Year Ending 30 June 2020 — Asia-Pacific Targets All Sectors

AnnouncedDate

Status Bidder Company Target Company Sector Vendor Company Deal Value(US$m)

9-Mar-20 P Charoen Pokphand Foods Public Company Limited; CP ALL Plc; and Charoen Pokphand Holding Co Ltd

Tesco Stores (Thailand) Limited; and Tesco Stores (Malaysia) Sdn. Bhd. Consumer Tesco Plc; and Sime Darby Berhad 10,576

22-Jan-20 P CapitaLand Mall Trust CapitaLand Commercial Trust Real Estate 8,007

15-Jun-20 P Consortium for 58.com 58.com Inc Technology, Media & Telecom 7,600

27-Feb-20 C Acquisition vehicle owned by Peter Woo Wheelock & Company Limited (32.51% stake) Real Estate 6,157

22-Apr-20 C Facebook Inc Jio Platforms Limited (9.99% stake) Technology, Media & Telecom 5,708

21-Mar-20 P Cred Holding Co Ltd Liaoning Zhongwang Group Co Ltd Industrials, Manufacturing & Engineering Liaoning Zhongwang Precision Investment Co Ltd; and National Junmin Ronghe Industrial Investment Fund Co Ltd

5,345

31-Jan-20 C Hitachi Ltd Hitachi High-Tech Corporation (48.27% stake) Industrials, Manufacturing & Engineering 4,886

27-Feb-20 C Sichuan Railway Investment Group Co Ltd Sichuan Road & Bridge Co Ltd (9.32% stake) Construction 4,103

12-Jun-20 P Consortium for Yixin Group Ltd Yixin Group Limited (77.94% stake) Technology, Media & Telecom 3,860

19-May-20 C Sony Corporation Sony Financial Holdings Inc (34.96% stake) Financial Services 3,679

9-Jun-20 C UV Asset Reconstruction Company Limited; and Aircel Limited (Financial creditors)

Aircel Limited Technology, Media & Telecom 2,632

4-Mar-20 C Tencent Holdings Ltd; SB China Venture Capital Co Ltd; Sequoia Capital China; and Hillhouse Capital Management Ltd

Tianjin Xiaowu Information Technology Co Ltd Technology, Media & Telecom 2,400

11-Mar-20 P Chengdu Xingcheng Investment Group Co Ltd Chengdu Rural Commercial Bank Co Ltd (35% stake) Financial Services Anbang Insurance Group Co Ltd 2,372

17-Jan-20 P Shaanxi Yanchang Petroleum Chemical Engineering Co Ltd Shaanxi Construction Engineering Group Corporation Construction Shaanxi Construction Engineering Holding Group Co Ltd; and Shaanxi Construction Engineering Industrial Co Ltd

2,267

18-May-20 P Vedanta Resources Limited Vedanta Limited (49.86% stake) Energy, Mining, Oil & Gas 2,151

10-Apr-20 P KB Financial Group Inc Prudential Life Insurance Company of Korea Ltd Financial Services Prudential Financial Inc 1,867

20-Mar-20 C Consortium for Li & Fung Limited Li & Fung Limited (67.67% stake) Consumer 1,857

9-Apr-20 C Toyota Motor Corporation Nippon Telegraph and Telephone Corporation (2.17% stake) Technology, Media & Telecom 1,840

10-Jan-20 C Macquarie Infrastructure and Real Assets AirTrunk Operating Pty Ltd (88% stake) Business Services Goldman Sachs & Co LLC; and TPG Capital LP 1,817

10-Mar-20 P Huida Asset Management Co Ltd; and Liaoning Financial Holding Group Co Ltd Bank of Jinzhou Co Ltd (44.34% stake) Financial Services 1,739

C= Completed; P= Pending; L= Lapsed

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HY 2020All Sectors


2.1%

31%

37.1%

7.8% 3% 3%

13.4%

2.6%

32.5%

1.5%

30.2%

3.2%

9.4%

0.1%

5.1%

2.6%

15.4%

Mix of deals by geographic regionDeal count

Based on announced deals, excluding those that lapsed or were withdrawn. Geographic region is determined with reference to the dominant location of the target.

Mix of deals by geographic regionValue

Based on announced deals, excluding those that lapsed or were withdrawn. Geographic region is determined with reference to the dominant location of the target.

Australasia

East Asia

North America

Central Asia

South Asia

Europe

Japan

South East Asia

RoW

Australasia

East Asia

North America

Central Asia

South Asia

Europe

Japan

South East Asia

RoW

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HY 2020All Sectors


Num

ber

of d

eals

0

50

100

150

200

250

300

350

Def

ense

Agr

icul

ture

Real

Est

ate

Con

stru

ctio

n

Life

Sci

ence

s &

Hea

lthca

re

Tran

spor

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n

Leis

ure

Tech

nolo

gy, M

edia

& T

elec

om

Ener

gy, M

inin

g, O

il &

Gas

Con

sum

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Bus

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s S

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ces

Fina

ncia

l Ser

vice

s

Indu

stria

ls, M

anuf

actu

ring

& E

ngin

eerin

g

81

20

337

160

185170

148

303

6960

138

71

2

Valu

e (U

S$

bn)

0

5

10

15

20

25

30

35

40

45

50

55

60

Def

ense

Agr

icul

ture

Real

Est

ate

Con

stru

ctio

n

Life

Sci

ence

s &

Hea

lthca

re

Tran

spor

tatio

n

Leis

ure

Tech

nolo

gy, M

edia

& T

elec

om

Ener

gy, M

inin

g, O

il &

Gas

Con

sum

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Bus

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s S

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ces

Fina

ncia

l Ser

vice

s

Indu

stria

ls, M

anuf

actu

ring

& E

ngin

eerin

g

US$0.4

US$1

US$7.9

US$13.8

US$15

US$33.1

US$22.2

US$14.4

US$35.3

US$21.5

US$26.6

US$4.6

US$59.2

Mix of deals by industry sectorDeal count

Based on announced deals, excluding those that lapsed or were withdrawn, where the dominant location of the target is Asia Pacific. Industry sector is based on the dominant industry of the target.

Mix of deals by industry sectorValue

Based on announced deals, excluding those that lapsed or were withdrawn, where the dominant location of the target is Asia Pacific. Industry sector is based on the dominant industry of the target.

Mergermarket 10

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HY 2020All Sectors


0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

H1 2020201920182017201620152014

Valu

e (U

S$

m)

Volum

e

0

250

500

750

1,000

1,250

1,500

US$287,545

US$74,352

US$269,988

US$300,067

US$257,403 US$

240,665

US$298,198

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

500,000

550,000

H1 2020201920182017201620152014

Valu

e (U

S$

m)

Volum

e0

250

500

750

1,000

1,250

1,500

1,750

2,000

2,250

2,500

US$384,258

US$371,914

US$369,934

US$421,844

US$442,706

US$502,946

US$124,381

Exits

Based on announced deals, excluding those that lapsed or were withdrawn, where the dominant location of the target is Asia Pacific.

Buyouts


Deal countValue Value Deal count

Mergermarket 11

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HY 2020All Sectors


0

100

200

300

400

500

600

700

800

900

1,000

H1 2020201920182017201620152014

Valu

e (U

S$

bn)

US$89

US$31.5

US$34.7

US$123.6

US$197.7

US$80.3

US$38

US$67.5

US$83.6

US$91.6

US$136.3

US$118.2

US$144

US$238.8

US$100.1

US$160.8

US$79.2

US$171.9

US$107.1

US$88.9

US$181.7

US$177.6

US$84.2

US$185.7US$

125.2

US$175.4

US$175.2

US$199.8 US$

173.5

US$111.3

US$242.4

US$122.2

US$105.2

US$197

US$291.1

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

H1 2020201920182017201620152014

Num

ber

of d

eals

982

230

262

183

227

169143

216

175

23

4342

35

8

2416

19

224

254

3112

787 809 917

2,780

3,068

657 709

3,152

3,4443,375

5

223

206

18836

11

378

3,134

843

1,182

87

$5m - $250m

$2,001m - $5,000m

Value not disclosed

$501m - $2,000m

$251m - $500m

> $5,001m

$5m - $250m

$2,001m - $5,000m

$501m - $2,000m $251m - $500m

M&A split by deal sizeValue

M&A split by deal sizeDeal count

> $5,001m

Mergermarket 12

mergermarket.com


HY 2020All Sectors


0

250

500

750

1,000

1,250

1,500

Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1

Num

ber

of d

eals

2014 2015 2016 2017 2018 2019 2020

Valu

e (U

S$

m)

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q12014 2015 2016 2017 2018 2019 2020

Quarterly M&A activityDeal count


Quarterly M&A activityValue


Moving average trend lineDeal value Moving average trend lineDeal count

Mergermarket 13

mergermarket.com


HY 2020All Sectors


League tables

Financial advisors by deal countFinancial advisors by value

The legal advisor mid-market league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and include lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and cover all sectors.

The financial advisor mid-market league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and exclude lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and cover all sectors.

Legal advisors by value Legal advisors by deal count

H1 2020 H1 2019 Company Name Value (USD m)

Number of Deals

1 3 Morgan Stanley 33,496 32

2 1 Goldman Sachs & Co 27,561 21

3 4 JPMorgan 26,748 21

4 13 Deloitte 22,586 66

5 18 HSBC 22,167 10

6 2 Bank of America 15,927 18

7 9 UBS Investment Bank 15,551 14

8 15 Nomura Holdings 14,778 33

9 7 Credit Suisse 14,205 14

10 24 China International Capital 13,891 21


Number of Deals

1 24 Davis Polk & Wardwell 25,781 21

2 3 Shardul Amarchand Mangaldas & Co 22,669 40

3 16 AZB & Partners 21,773 47

4 56 Weil, Gotshal & Manges 19,950 10

5 17 Cyril Amarchand Mangaldas 18,502 51

6 29 Mori Hamada & Matsumoto 17,525 43

7 41 Fangda Partners 16,947 32

8 8 Herbert Smith Freehills 16,494 30

9 13 Kirkland & Ellis 16,315 17

10 35 Skadden, Arps, Slate, Meagher & Flom 15,945 16


Number of Deals

1 2 Deloitte 22,586 66

2 1 PwC 4,191 53

3 5 EY 7,468 43

4 3 KPMG 2,916 35



7 18 Sumitomo Mitsui Financial Group 2,800 23


9 11 JPMorgan 26,748 21



Number of Deals


2 8 Nishimura & Asahi 6,241 50

3 1 AZB & Partners 21,773 47



6 4 Khaitan & Co 2,035 34

7 2 King & Wood Mallesons 8,116 33


9 6 Kim & Chang 5,781 32



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HY 2020All Sectors


League tables

Financial advisors by deal count — mid-market (US$5m – US$250m)Financial advisors by value — mid-market (US$5m – US$250m)

Legal advisors by deal count — mid-market (US$5m – US$250m)Legal advisors by value — mid-market (US$5m – US$250m)

The legal advisor mid-market league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and include lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and cover all sectors.

The financial advisor mid-market league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and exclude lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and cover all sectors.


Number of Deals

1 1 PwC 2,502 34

2 3 Deloitte 1,410 25



5 2 EY 1,250 21

6 15 Citi 1,087 6

7 10 CITIC Securities Co 879 9

8 7 KPMG 868 20

9 19 China Securities Co 815 5

10 5 Daiwa Securities Group / DC Advisory 810 7


Number of Deals


2 2 AZB & Partners 1,753 18

3 1 Kim & Chang 1,735 25

4 11 DLA Piper 1,638 18


6 24 Shin & Kim 1,418 16




10 6 Khaitan & Co 1,115 22


Number of Deals

1 1 PwC 2,502 34

2 2 Deloitte 1,410 25

3 3 EY 1,250 21

4 4 KPMG 868 20



7 10 CITIC Securities Co 879 9

8 11 Mizuho Financial Group 440 8

9 5 Daiwa Securities Group / DC Advisory 810 7

10 9 Morgan Stanley 761 7


Number of Deals

1 4 Kim & Chang 1,735 25



4 3 Khaitan & Co 1,115 22



7 9 DLA Piper 1,638 18





HY 2020All Sectors

mergermarket.com


League tables

The PR advisor league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and exclude lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and cover all sectors.

The PR advisor mid-market league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and exclude lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and cover all sectors.

PR advisors by deal count PR advisors by value

PR advisors by deal count — mid-market (US$5m – US$250m)PR advisors by value — mid-market (US$5m – US$250m)


Number of Deals

1 1 Brunswick Group 12,100 11

2 80 Christensen Investor Relations 7,795 5

3 3 Sard Verbinnen & Co 7,634 14

4 - Gagnier Communications 4,079 2

5 6 Kekst CNC (Publicis) 3,679 5

6 7 Edelman 2,996 4

7= 8 Citadel Magnus 2,054 5

7= 14 Domestique Consulting 2,054 5

9 5 FTI Consulting 1,987 7

10 92 Teneo 1,857 2


Number of Deals

1 1 Sard Verbinnen & Co 787 6

2 - Longview Communications & Public Affairs 492 1

3 42 Adfactors PR 379 3

4 46 GRACosway 347 2

5 34 ICR 326 3

6 9 Brunswick Group 282 4

7 21 Citadel Magnus 277 3

8 - Burson Marsteller 237 1

9 - Concept Agencia de Comunicacao 205 1

10 16 The Piacente Group 200 1


Number of Deals

1 1 Sard Verbinnen & Co 7,634 14

2 3 Brunswick Group 12,100 11

3 2 FTI Consulting 1,987 7

4 80 Christensen Investor Relations 7,795 5

5 4 Kekst CNC (Publicis) 3,679 5

6= 9 Citadel Magnus 2,054 5

6= 11 Domestique Consulting 2,054 5

8 5 Edelman 2,996 4

9 31 The Piacente Group 1,386 4

10 14 ICR 636 4


Number of Deals

1 1 Sard Verbinnen & Co 787 6

2 9 Brunswick Group 282 4

3 10 FTI Consulting 195 4

4 26 Adfactors PR 379 3

5 12 ICR 326 3

6 6 Citadel Magnus 277 3

7 - Christensen Investor Relations 195 3

8 28 Cannings Purple 81 3

9 48 GRACosway 347 2

10 58 Media & Capital Partners 135 2

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HY 2020All Sectors


Financial Services

Part of the Acuris reporton global M&A activity

mergermarket.com


HY 2020Financial Services


Financial ServicesOverview

The financial services sector was one of the few industries to see deal activity hold up through the course of COVID-19 lockdowns.

There were 160 financial services deals worth US$33.1bn recorded during the first six months of 2020, only marginally down on 2019 year-on-year deal value of US$34.5bn from 169 transactions.

Deal activity in the industry has proven resilient despite a period of volatility. This is in large part down to the growing maturity and expansion of the industry across Asia during the last decade, with China, the region’s largest economy, driving this growth. China’s banking industry alone is now larger than that of Europe’s, according to analysis from Deloitte, and it boasts four of the world’s 10 largest banks.

A substantial amount of deal value in the sector in H1, however, was due to restructuring activity, especially among Chinese financial institutions. The largest of these was the US$2.4bn sale of a 35% stake in Chengdu Rural Bank to Chengdu Xingcheng Investment Group, a local government-backed investment group. The deal comes after extensive restructuring of seller Anbang Insurance, which saw fraud investigation into its former chairman and regulator China Insurance Regulatory Commission (CIRC) seize control of the business for two years.

The Chinese government’s intervention into Anbang was part of a campaign to crack down on risky debt among Chinese corporates,

especially among highly acquisitive businesses like Anbang.

Another significant Chinese deal involving restructuring was the US$1.7bn capital injection into troubled regional lender Bank of Jinzhou by two government-backed bodies, Huida Asset Management—a special purposed vehicle owned by the central government-backed People’s Bank of China (PBOC)—and Liaoning Financial Holding—an investment vehicle set up by the Liaoning provincial government, where Bank of Jinzhou is located. The transaction—announced in March—was for a 44.3% equity stake in the bank and came eight months after ICBC, one of China’s largest banks, injected US$436.2m into the business.

But although China accounted for six of the 15 largest financial services deals in H1 2020 in APAC, deal activity was observed elsewhere in the region as well.

The largest financial services deal for the period, for example, was in Japan where Sony Corporation announced in May its plan to buy out the 35% stake it doesn’t already own in Sony Financial Holdings in a US$3.7bn transaction. Sony Financials offers a range of banking, insurance and credit card services and by acquiring the company outright Sony would have the opportunity to strengthen its position in the fintech market and pivot away from relying exclusively on low-margin consumer electronics for the bulk of its revenues.

In the third biggest financial services deal of H1 this year in the region, Prudential Financial off-loaded its Prudential Life Insurance business in South Korea to KB Financial for US$1.9bn. The deal saw Prudential exit the Asian market after three decades. For KB Financial, the deal gives it further scale in its core market, which will make its life insurance business more competitive.

India has also proved a fertile market for financial services deals through H1 2020, with a government program in place to encourage consolidation of the country’s banking market driving Union Bank of India’s US$978m purchase of Corporation Bank, Punjab National Bank’s acquisition of Oriental Bank of Commerce for US$953m and a US$801m deal by Canara Bank for Syndicate Bank.

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Top deals

Top 15 Announced Deals for Half Year Ending 30 June 2020 — Asia-Pacific Targets Financial Services Sector

AnnouncedDate

Status Bidder Company Target Company Vendor Company Deal Value(US$m)

19-May-20 C Sony Corporation Sony Financial Holdings Inc (34.96% stake) 3,679

11-Mar-20 P Chengdu Xingcheng Investment Group Co Ltd Chengdu Rural Commercial Bank Co Ltd (35% stake) Anbang Insurance Group Co Ltd 2,372

10-Apr-20 P KB Financial Group Inc Prudential Life Insurance Company of Korea Ltd Prudential Financial Inc 1,867

10-Mar-20 P Huida Asset Management Co Ltd; and Liaoning Financial Holding Group Co Ltd Bank of Jinzhou Co Ltd (44.34% stake) 1,739

31-Mar-20 P Xiandai Investment Co Ltd Hunan Changshaolou Highway Co Ltd Hunan Metro Group Co Ltd 1,510

14-Jan-20 P Bailian Group Co Ltd Shanghai Securities Co Ltd (50% stake) Guotai Junan Securities Co Ltd; Shanghai International Group Corporation Limited; and Shanghai SITICO Assets Management Co Ltd

1,487

31-Jan-20 C Brookfield Business Partners LP IndoStar Capital Finance Limited (62.77% stake) IndoStar Capital Mauritius 1,455

15-Mar-20 C State Bank of India; Federal Bank Ltd; Housing Development Finance Corporation Ltd; Kotak Mahindra Bank Limited; ICICI Bank Limited; Axis Bank Ltd; IDFC First Bank; and Bandhan Bank Limited

Yes Bank Ltd (79.68% stake) 1,350

12-May-20 P Kohlberg Kravis Roberts & Co LP Colonial First State Investment Limited (55% stake) Commonwealth Bank of Australia 1,238

23-Mar-20 P Chengdu Hi-tech Investment Group Co Ltd; and Chengdu Wuhou Industry Investment & Development Group Co Ltd

Chengdu Rural Commercial Bank Co Ltd (20.5% stake) Anbang Insurance Group Co Ltd 1,226

5-Mar-20 C Union Bank of India Corporation Bank 978

5-Mar-20 P Punjab National Bank Oriental Bank of Commerce 953

5-Mar-20 C Canara Bank Syndicate Bank 801

30-Mar-20 P Undisclosed bidder Shanghai Longhua International Aviation Investment Co Ltd (55% stake) Shanghai Civil Aviation Investment Development Corporation 720

5-Mar-20 C Punjab National Bank United Bank of India 663


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Num

ber

of d

eals

0

50

100

150

200

250

300

350

400

H1 2020201920182017201620152014

105

227

242226 2

15

7

32

2331

38

20

24

27

5

3 2

65 5

21

1

248

57

16

21

9

16

22

15

6248

175

216

5343 4829

0

10

20

30

40

50

60

70

80

90

100

110

H1 2020201920182017201620152014

Valu

e (U

S$

bn)

US$3.9

US$18.1

US$34.7

US$8.9

US$14

US$21.6

US$6.1

US$16.7

US$42.1

US$25.2

US$9.2

US$14

US$14.2

US$14

US$33.7

US$10.4

US$18.2

US$15

US$12

US$17

US$21.7

US$20.3

US$16.9

US$15.9

US$25.1

US$14.3

US$23.3

US$5.9

US$16.3

US$6

US$17.2

US$6.1

$5m - $250m

$2,001m - $5,000m

Value not disclosed

$501m - $2,000m

$251m - $500m

> $5,001m

$5m - $250m

$2,001m - $5,000m

$501m - $2,000m $251m - $500m



> $5,001m

Mergermarket 20

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Num

ber

of d

eals

0

10

20

30

40

50

60

70

80

90

100

110

120

130

140


Valu

e (U

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0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

55,000

60,000







Mergermarket 21

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League tables


The legal advisor league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and include lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and are based on the following sector: Financial Services.

The financial advisor league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and exclude lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and are based on the following sector: Financial Services.



Number of Deals



3 81 Nagashima Ohno & Tsunematsu 4,073 3

4= 27 Cleary Gottlieb Steen & Hamilton 3,679 1

4= 45 Davis Polk & Wardwell 3,679 1

4= - Oh-Ebashi LPC & Partners 3,679 1


8 - Guantao Law Firm 3,598 2

9 11 Kim & Chang 2,778 5

10= 42 Debevoise & Plimpton 1,867 1

10= 19 Yulchon 1,867 1


Number of Deals




4 8 Kim & Chang 2,778 5

5 62 Allens 1,825 5


7 3 Shardul Amarchand Mangaldas & Co 238 4


9 16 White & Case 876 3

10 43 Kirkland & Ellis 509 3


Number of Deals


2 12 Deloitte 4,156 5


4 18 EY 4,110 8


6 25 Plutus Consulting Co 3,867 2

7 14 RBSA Advisors 3,144 4





Number of Deals

1 4 EY 4,110 8


3 2 Deloitte 4,156 5






9 8 Citi 566 3

10 33 Plutus Consulting Co 3,867 2

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Part of the Acuris report on global M&A activity

Industrials, Manufacturing & Engineering

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HY 2020Industrials, Manufacturing & Engineering


Industrials, Manufacturing & EngineeringOverview

Industrials, manufacturing & engineering (IME) was the second largest sector by deal value in APAC in H1 2020 despite suffering a large decline in activity year-on-year.

Deal value for the sector came in at US$35.3bn in H1 2020, less than half the US$77.3bn total for H1 2019. Deal volume fell 19% to 337 deals over the same period.

Lockdowns and economic contraction around the world have dampened demand for chemicals, with petrochemical producers also affected by the supply glut and falling prices in oil markets. Demand for manufactured goods has also slumped, with uncertainty around order books and challenges keeping factories operational in the event of further COVID-19 flare ups—causing knock-on effects on industrials.

The sector has been directly exposed to disruption in global supply chains caused by COVID-19 and simmering trade tension, particularly between China and the US.

After agreeing a Phase 1 trade deal early in the year, China and the US are now at risk of seeing the agreement falter following tensions over Hong Kong, the handling of the coronavirus and provision of equipment for 5G infrastructure by China’s Huawei. The UK has also blocked Huawei as a supplier for its 5G network and attention has now turned to how the EU will react.

M&A, however, could prove to be an important lever in the response to the challenges posed by both the pandemic and trade issues, with businesses turning to deals to consolidate market positions and supply chains in key domestic markets.

China, the region’s industrials powerhouse, has accounted for all but two of the 15 largest IME deals. These include the US$5.34bn deal involving aluminum producer Zhongwang Group, one of the world’s largest manufacturers of aluminum products used by the transport, electronic and construction industries. In the proposed deal, Zhongwang will combine with listed entity Cred Holding in a reverse takeover so that it can be traded as a public company on the Shanghai Stock Exchange. This will help the aluminum business to secure funding independently.

Japan accounted for the two top 15 deals that didn’t involve China, with Hitachi acquiring the shares it didn’t already own in its Hitachi High-

Technologies subsidiary for US$4.9bn. Hitachi wants to bring the two businesses together to enhance its Internet of Things platform, Lumada.

Private equity firm Bain Capital, meanwhile, bought out Showa Aircraft Industry for US$858m from Mitsui, which was selling to secure funds and strengthen its balance sheet.

The sector has been directly exposed to disruption in global supply chains caused by COVID-19 and simmering trade tension, particularly between China and the US.

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Top deals

Top 15 Announced Deals for Half Year Ending 30 June 2020 — Asia-Pacific Targets Industrials, Manufacturing & Engineering Sector

AnnouncedDate


21-Mar-20 P Cred Holding Co Ltd Liaoning Zhongwang Group Co Ltd Liaoning Zhongwang Precision Investment Co Ltd; and National Junmin Ronghe Industrial Investment Fund Co Ltd

5,345

31-Jan-20 C Hitachi Ltd Hitachi High-Tech Corporation (48.27% stake) 4,886

12-Jun-20 P Yangquan Coal Chemical Group Co Ltd Shanxi Yangmei Fengxi Fertilizer Industry (Group) Co Ltd; Hebei Yangmei Zhengyuan Chemical Group Co Ltd; Yangmei Group Shouyang Chemical Industry Co Ltd; and Yangmei Group Shenzhou Chemical Co Ltd (54.6% stake)

Yangmei Chemical Co Ltd 1,297

3-Jan-20 C A group of 8 investors led by BOC Financial Asset Investment Co Ltd Inner Mongolia Baogang Metal Manufacturing Co Ltd (25.69% stake) 1,110

29-Apr-20 P Hefei Construction Investment Holding (Group) Co Ltd; Anhui High Technology Industry Investment Co Ltd; and CMG-SDIC Capital Co Ltd

NIO (Anhui) Holding Ltd (24.1% stake) NIO Inc 989

23-Jan-20 C Bain Capital LP Showa Aircraft Industry Co Ltd Mitsui E&S Holdings 858

29-May-20 P Volkswagen (China) Investment Company Ltd Guoxuan High-tech Co Ltd (23.08% stake) 840

15-Jun-20 P Mr. Jie Han (Private investor) China XD Plastics Company Limited (50.61% stake) 815

26-Feb-20 P Yidian Holding Group (Luoyang) Nonferrous Metals Co Ltd Yingkou Zhongwang Aluminium Material Co Ltd China Zhongwang Holdings Limited 653

30-Apr-20 P TCL Technology Group Corporation Wuhan China Star Optoelectronics Technology Co Ltd (39.95% stake) Wuhan Optics Valley Industrial Investment Co Ltd 597

23-Apr-20 P HBIS Company Limited HBIS Leting Iron & Steel Co Ltd Xuanhua Iron & Steel Group Company Co Ltd 511

23-May-20 P Hangzhou Iron and Steel Co Ltd Zhejiang Metallurgical Materials Co Ltd; Zhejiang Hanggang International Trade Co Ltd (99.5% stake); Zhejiang Dongling Trading Co Ltd; and Zhejiang Fucheun Company Limited (Operating Assets of Commerce and Trading Unit)

Zhejiang Fuchuen Company Limited; Zhejiang Hanggang Trading Group Co Ltd; and Zhejiang Dongling Co Ltd

437

18-Jan-20 P Qinghai Huixin Asset Management Co Ltd Qinghai Salt Lake Industry Co Ltd (Asset Package) Qinghai Salt Lake Industry Co Ltd 437

14-Jan-20 P Chongqing Nanfang Industrial Equity Investment Fund Partnership LP; Nanjing Runke Industry Investment Co Ltd; Chongqing Changxin Equity Investment Fund Partnership LP; and Chongqing Liangjiang New District Chengwei Equity Investment Fund Partnership

Chongqing Changan New Energy Automobile Technology Co Ltd (51.05% stake) 412

31-Jan-20 P Yanfeng Automotive Trim Systems Co Ltd Yanfeng Global Automotive Interior Systems Co Ltd (30% stake) Adient plc 369


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0

100

200

300

400

500

600

700

800

900

1,000

H1 2020201920182017201620152014

Num

ber

of d

eals

67

247

28

27

3

48

32

48

2326

46

281

1

5

41

2

45

32

140 130176

745698

720

4

682

579

139 129

6

1

2

42

42

162

656

9

12

0

25

50

75

100

125

150

H1 2020201920182017201620152014

Valu

e (U

S$

bn)

US$13.6

US$7.2

US$10.2

US$14

US$31.6

US$18.7

US$37.4

US$32.5

US$19

US$37.2

US$23.2

US$12.4

US$9.9

US$31.5

US$18.6

US$41.1

US$18.8

US$8.7

US$13.8

US$7.6

US$38.6

US$20.8

US$22

US$6

US$12.4

US$33

US$29.4

US$14

US$17

US$37.4

US$15

US$43.4

US$4.3

US$28.6

$5m - $250m

$2,001m - $5,000m

Value not disclosed

$501m - $2,000m

$251m - $500m

> $5,001m

$5m - $250m

$2,001m - $5,000m

$501m - $2,000m $251m - $500m

> $5,001m



Mergermarket 26

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Valu

e (U

S$

m)

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000


0

25

50

75

100

125

150

175

200

225

250

275

300

325


Num

ber

of d

eals

2014 2015 2016 2017 2018 2019 2020






Mergermarket 27

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League tables

The legal advisor league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and include lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and cover the following sectors: Automotive; Chemicals & Materials; Industrials — electronics, automation and products and services; and Manufacturing — other.

The financial advisor league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and exclude lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and cover the following sectors: Automotive; Chemicals & Materials; Industrials — electronics, automation and products and services; and Manufacturing — other.




Number of Deals



3 - Lianchu Securities Co 5,495 2

4 - Minsheng Securities Co 5,345 1

5 9 Deloitte 4,968 14


7 1 CITIC Securities Co 1,521 7

8 58 Daiwa Securities Group / DC Advisory 1,394 4

9 26 Citi 1,240 3

10 - Centerview Partners 1,031 1


Number of Deals


2 43 Anderson Mori & Tomotsune 5,744 3

3 88 Commerce and Finance Law Offices 5,345 1


5 2 Zhong Lun Law Firm 1,400 6



8 103 Ropes & Gray 1,238 2


10 30 Grandall Law Firm 1,089 7


Number of Deals

1 1 PwC 841 19

2 3 Deloitte 4,968 14

3 5 KPMG 341 8



6 13 EY 331 6



9 19 Daiwa Securities Group / DC Advisory 1,394 4

10 36 JPMorgan 972 4


Number of Deals

1 5 Nishimura & Asahi 436 12


3 8 Grandall Law Firm 1,089 7

4 10 Khaitan & Co 111 7


6 2 Zhong Lun Law Firm 1,400 6


8 7 AZB & Partners 664 6


10 3 Kim & Chang 784 5

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Energy, Mining, Oil & Gas

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HY 2020Energy, Mining, Oil & Gas


Energy, Mining, Oil & GasOverview

Falling oil prices, volatile commodities markets and supply imbalances have seen energy, mining, oil & gas deal activity slide around the world. APAC has been no exception.

Deal value in the sector fell from US$29.8bn in H1 2019 to US$21.5bn in H1 2020, a 28% decline. Deal volume also fell, though far less precipitously, from 163 deals to 148 deals over the same period, a 9% drop.

But although global oil and commodity markets have taken a toll on energy, mining & utilities deals in the APAC region, the drop in activity hasn’t been as steep as in other regions—global value in the sector plummeted by 68% year-on-year, while volume fell 33%—with a number of high profile utilities deals keeping activity levels ticking over.

India, for example, has seen a number of power providers change hands, driven in part by the shift to less carbon-intensive sources of energy.

Power utility NTPC acquired two hydropower plants from the government of India—THDC India and North Eastern Electric Power—in deals worth US$1.5bn and US$1.4bn, respectively. Other energy deals to proceed in India included French energy multinational Total investing in Wardha Solar as part of a joint venture with Adani Green Energy in a US$519m deal. The deal is part of Total’s strategy to expand its solar portfolio and invest in countries where there is opportunity to diversify the energy mix.

Other European players have also seen attractive dynamics in APAC’s power networks. Spain’s Iberdrola announced a proposal to acquire Australia’s Infigen Energy for US$991m and Electricite de France (EDF) acquired a 37.5% stake in China Energy Group Dongtai for US$1.1bn.

Iberdrola has a long-term strategy to expand its clean energy portfolio and the Infigen deal strengthens its position in Australia’s thriving renewable energy industry. EDF has similar ambitions to build its renewable energy portfolio and the Dongtai transaction allows it to expand its offshore wind portfolio beyond Europe and into China’s fast-growing wind farm industry. The deal is the first offshore wind power project in China to include an overseas investor.

A few mining transactions have also been prominent. The largest deal in the sector saw India’s Vedanta Resources delist its publicly traded subsidiary Vedanta Limited in a US$2.15bn transaction. The deal was done primarily for operational and organizational reasons, but with stock prices falling there was also a window to execute the transaction at an attractive valuation.

In Indonesia another mining deal saw Vale Canada and Sumitomo Metal sell a 20% stake of PT Vale Indonesia to Mining Industry Indonesia in a US$428m transaction. Vale Canada and Sumitomo Metal sold to state-

owned Mining Industry to comply with Indonesian rules that oblige foreign owners of mining assets to reduce ownership stakes to 49% or less within a decade of commencing operations.

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Top deals

Top 15 Announced Deals for Half Year Ending 30 June 2020 —Asia-Pacific Targets Energy, Mining, Oil & Gas Sector

AnnouncedDate


18-May-20 P Vedanta Resources Limited Vedanta Limited (49.86% stake) 2,151

26-Mar-20 C NTPC Limited THDC India Ltd (74.45% stake) Government of India 1,505

26-Mar-20 C NTPC Limited North Eastern Electric Power Corporation Limited Government of India 1,437

7-Feb-20 P Prime Metro Power Holdings Corp. Manila Water Company Inc (72% stake) 1,402

26-Feb-20 P Electricite de France SA China Energy Group Dongtai Offshore Wind Power Co Ltd (37.5% stake) 1,136

17-Jun-20 P Iberdrola SA Infigen Energy Limited 991

3-Jun-20 C Consortium formed by AC Energy Group and UPC Renewable Group Infigen Energy Limited (87.18% stake) 881

1-Jun-20 P China Huadian Corporation Ltd Huadian Fuxin Energy Corporation Limited 829

17-Feb-20 L JSW Energy Limited GMR Kamalanga Energy Ltd GMR Energy Limited 659

8-Jun-20 P Zijin Mining Group Co Ltd Tibet Julong Copper Co Ltd (50.1% stake) Zangge Holding Company Limited; Tibet Zhongsheng Mining Co Ltd; Shenzhen Chenfang Asset Management Co Ltd; Tibet Huibaihong Industrial Co Ltd; and Tibet Zangge Venture Capital Group Co Ltd

549

6-Feb-20 C Total SA Wardha Solar (Maharashtra) Pvt Ltd (50% stake); Adani Green Energy (UP) Limited (50% stake); Parampujya Solar Energy Private Limited (50% stake); Prayatna Developers Private Limited (50% stake); Adani Renewable Energy (RJ) Ltd (50% stake); Kodangal Solar Parks Pvt Ltd (50% stake); Adani Green Energy (Tamil Nadu) Limited (50% stake); Kamuthi Renewable Energy Limited (50% stake); Kamuthi Solar Power Limited (50% stake); Ramnad Renewable Energy Limited (50% stake); and Ramnad Solar Power Limited (50% stake)

Adani Green Energy Ltd 519

30-Mar-20 C GAIL (India) Limited Konkan LNG Limited (28.13% stake) IFCI Limited; State Bank of India; IDBI Bank (formerly known as Industrial Development Bank of India); ICICI Bank Limited; and Canara Bank

507

22-Jun-20 P Adani Properties Private Limited Adani Power Limited (25.03% stake) 431

18-Jun-20 P Mining Industry Indonesia PT Vale Indonesia Tbk (20% stake) Vale Canada Limited; and Sumitomo Metal Mining Co Ltd 428

28-Feb-20 C Sprng Energy Pvt Ltd ACME Cleantech Solutions Pvt Ltd (600MW solar portfolio) ACME Cleantech Solutions Pvt Ltd 414


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0

50

100

150

200

250

300

350

400

H1 2020201920182017201620152014

Num

ber

of d

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10

113

16

9

7

4

32

7

20

229288

280295

276

19

22

6

21

33

11

7 26

27

1

5

35 4346 45

5

52

13

12

302

19

23

1

37

4

0

25

50

75

100

125

150

H1 2020201920182017201620152014

Valu

e (U

S$

bn)

US$11

US$6.2

US$22.6

US$8.2

US$13.2

US$18.1

US$8.6

US$37.2

US$10.4

US$16.2

US$19.2

US$23.6

US$27.7

US$22.6

US$12.3 US$

11.5

US$32.1 US$

17.5

US$24.1

US$6.6

US$22.4

US$31.5

US$6.7

US$17.3

US$18.9

US$4.4

US$18.3

US$12.4

US$21.5

US$8.6

US$6.8

US$4.3

US$65.2

$5m - $250m

$2,001m - $5,000m

Value not disclosed

$501m - $2,000m

$251m - $500m

> $5,001m

$5m - $250m

$2,001m - $5,000m

$501m - $2,000m $251m - $500m

> $5,001m



> $5,001m

Mergermarket 32

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Valu

e (U

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m)

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

55,000

60,000


0

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20

30

40

50

60

70

80

90

100

110

120

130

140


Num

ber

of d

eals

2014 2015 2016 2017 2018 2019 2020






Mergermarket 33

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League tables

The legal advisor league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and include lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and are based on the following sector: Energy; Mining; Oil; and Gas .

The financial advisor league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and exclude lapsed and withdrawn deals.The tables are based on advice to an Asia-based bidder, target or vendor and are based on the following sector: Energy; Mining; Oil; and Gas .




Number of Deals

1 - SBI Capital Markets 2,942 2


3 19 Deloitte 1,638 4


5 - Lazard 971 2

6 40 Nomura Holdings 971 1

7 - China International Capital 900 2

8 13 Somerley Capital 829 1

9 3 Credit Suisse 759 3

10 11 UBS Investment Bank 720 2


Number of Deals


2 62 Trilegal 2,942 3

3 65 Gilbert + Tobin 1,953 6



6= - AnJie Law Firm 1,136 1

6= 47 JunHe 1,136 1

8 54 DLA Piper 1,084 3

9 21 Allens 954 4

10 35 Fangda Partners 952 2


Number of Deals

1 5 PwC 559 6

2 3 EY 650 5


4 1 Deloitte 1,638 4

5 - Hartleys 452 4

6 10 Credit Suisse 759 3

7 56 Scotiabank 545 3

8 8 JPMorgan 450 3

9 4 KPMG 321 3

10 - SBI Capital Markets 2,942 2


Number of Deals


2 3 AZB & Partners 905 7

3 29 Gilbert + Tobin 1,953 6



6 65 Baker McKenzie 897 5

7 28 Kim & Chang 573 5

8 7 Allens 954 4

9 18 Allen & Overy 799 4

10 38 Trilegal 2,942 3

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Consumer

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HY 2020Consumer


ConsumerOverview

Despite delivering the largest transaction in APAC in H1 2020—Charoen Pokphand Foods’ US$10.57bn takeover of retailer Tesco’s Thailand business—consumer deal activity has still come in down on levels seen a year ago.

Deal value for the sector fell 20% from US$28.4bn in H1 2019 to US$22.8bn in H1 2020. Year-on-year deal volume was down 19% from 218 deals to 174.

Consumer companies have been among the most impacted by COVID-19 lockdowns, with consumers unable to get to shops and tightening their personal budgets. According to research from McKinsey discretionary spending in Asia has dropped by as much as 90% in some retail categories, while a survey of 3,600 consumers in China, India and Indonesia by the consultancy in early May showed that more than half of those polled in each of the countries planned to delay large purchases.

But although this backdrop has put many deals on hold, there have been a number of notable consumer deals that have nevertheless progressed.

PepsiCo, for example, forged ahead with its US$735m acquisition of Hangzhou Haomusi Food from Haoxiangni Health Food Co., in the third largest deal of the sector in H1. The deal sees Pepsi take ownership of Be & Cheery, an online snacking business in the fast-growing Chinese snacks segment. Pepsi is willing to proceed with the proposed deal, despite

coronavirus uncertainty, because of the long-term outlook for the business.

Li & Fung Limited, the iconic Hong Kong supply chain and logistics company, also went ahead with a US$1.9bn take-private led by a consortium including its controlling family shareholders despite COVID-19 uncertainty. The business’s take-private—the second largest consumer sector deal in the region in H1—was done to help the company adjust to online shopping trends and digitalize its own supply chain networks.

Japan saw two of the five largest consumer deals in Asia. US-based PE firm KKR sold AlphaTheta, a maker of DJ equipment, to photo processing equipment business Noritsu Koki for US$605m five years after carving the company out of Pioneer, while retailer Arcland Sakamoto bought a stake in home goods retailer LIXIL Viva in a US$483m transaction. The deal allows seller Lixil to focus on its core business of making high-end toilets, kitchen units and furniture.

Consumer companies have been among the most impacted by COVID-19 lockdowns, with consumers unable to get to shops and tightening their personal budgets.

mergermarket.com


HY 2020Consumer


Top deals

Top 15 Announced Deals for Half Year Ending 30 June 2020 — Asia-Pacific Targets Consumer Sector

AnnouncedDate


9-Mar-20 P Charoen Pokphand Foods Public Company Limited; CP ALL Plc; and Charoen Pokphand Holding Co Ltd Tesco Stores (Thailand) Limited; and Tesco Stores (Malaysia) Sdn. Bhd. Tesco Plc; Sime Darby Berhad 10,576

20-Mar-20 C Consortium for Li & Fung Limited Li & Fung Limited (67.67% stake) 1,857

24-Feb-20 P PepsiCo Inc Hangzhou Haomusi Food Co Ltd Haoxiangni Health Food Co Ltd 735

2-Mar-20 C Noritsu Koki Co Ltd AlphaTheta Corporation Kohlberg Kravis Roberts & Co LP; and Pioneer Corporation 605

9-Jun-20 P Arcland Sakamoto Co Ltd Lixil Viva Corporation (45.45% stake) 483

27-Mar-20 C Coatue Management LLC; and Hillhouse Capital Management Ltd Shenzhen Mexixi Restaurant Management Co Ltd 400

27-Mar-20 C Chongqing General Trading Group Co Ltd Chongqing Department Store Co Ltd (9.36% stake) 395

25-Feb-20 P China Resources Vanguard Co Ltd Tesco Plc / China Resources Vanguard JV (20% stake) Tesco Plc 357

29-Jun-20 P TCL Industries Holdings (HK) Limited Moka International Limited TCL Electronics Holdings Limited 353

8-May-20 P China International Travel Service Corporation Limited Hainan Duty Free Co Ltd (51% stake) China National Travel Service Group Co Ltd 292

28-May-20 P Shanghai Yuyuan Tourist Mart (Group) Co Ltd Jinhui Liquor Co Ltd (29.99% stake) Gansu Yatter Investment Group Co Ltd 257

15-Apr-20 C Meiji Holdings Co Ltd Austasia Investment Holdings Pte Ltd (25% stake) Japfa Limited 254

24-May-20 P ITC Limited Sunrise Foods Private Limited 238

31-Jan-20 P Ajinomoto Co Inc Ajinomoto Co (Thailand) Ltd (6% stake) Thanachart Capital Public Company Limited 230

21-May-20 P Nanjing Dele Business Management Co Ltd; and Nanjing Xingyue Business Management Partnership LP Nanjing DELE Science & Technology Co Ltd Suzhou Victory Precision Manufacture Co Ltd 186


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HY 2020Consumer


0

10

20

30

40

50

60

70

80

90

100

110

H1 2020201920182017201620152014

Valu

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S$

bn)

US$6.2

US$10.6

US$10.6

US$14.1

US$7.9

US$17

US$7.5

US$18.6

US$13.9

US$8.9

US$3.1

US$15.8

US$11.8

US$9.3

US$7.3

US$9.8

US$16.3

US$17.2

US$17.5

US$19.7

US$14.6

US$19.1

US$15

US$24.2

US$46.7

US$6.2

US$7.5

US$5

US$23

US$8.3

US$13.6

US$18.2

US$3.2

US$2.3

0

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H1 2020201920182017201620152014

Num

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13

98

12

1

5

1

2

21

12

19

4

1

23

323

329

140111

23

3

10 20

314

121

153

15 25

268

113

295

88

252

3

17

260

118

23

1

6

$5m - $250m

$2,001m - $5,000m

Value not disclosed

$501m - $2,000m

$251m - $500m

> $5,001m

$5m - $250m

$2,001m - $5,000m

$501m - $2,000m $251m - $500m

> $5,001m



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HY 2020Consumer


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HY 2020Consumer


League tables

The legal advisor league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and include lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and are based on the following sector: Consumer — retail, food and other.

The financial advisor league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and exclude lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and are based on the following sector: Consumer — retail, food and other.




Number of Deals

1 - Huatai Securities Co 11,872 3


3 1 HSBC 7,521 3

4= 30 China Securities Co 5,041 1

4= - Tianfeng Securities Co 5,041 1

6 38 Deloitte 3,257 12

7 - Lazard 2,175 3


9 21 PwC 2,069 15



Number of Deals

1 117 Freshfields Bruckhaus Deringer 12,790 3

2 27 Allen & Overy 10,659 3


4= - Adnan Sundra & Low 10,576 1

4= 5 Linklaters 10,576 1

6 - Davis Polk & Wardwell 2,340 2


8 80 Slaughter and May 1,887 2


10 - Baer & Karrer 1,033 1


Number of Deals

1 3 PwC 2,069 15

2 4 Deloitte 3,257 12

3 5 KPMG 1,780 7

4 51 EY 1,034 6




8 33 Deutsche Bank 1,998 4

9 - Huatai Securities Co 11,872 3

10 6 HSBC 7,521 3


Number of Deals


2 48 Nagashima Ohno & Tsunematsu 242 5

3 1 Kim & Chang 241 5

4 14 Mori Hamada & Matsumoto 150 4

5 117 Freshfields Bruckhaus Deringer 12,790 3

6 33 Allen & Overy 10,659 3


8 - Mattos Filho, Veiga Filho, Marrey Jr. e Quiroga Advogados 717 3

9 23 Fangda Partners 416 3

10 10 Anderson Mori & Tomotsune 298 3

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HY 2020Consumer



Technology, Media & Telecom

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HY 2020Technology, Media & Telecom


Technology, Media & TelecomOverview

Not only was technology, media & telecom (TMT) Asia’s best-performing sector for M&A by some distance in H1 2020, but deal value in the sector even saw an uptick, despite disruption and uncertainty stemming from the COVID-19 pandemic.

There was US$59.2bn worth of deal value recorded in Asia in H1 2020, a 40% rise on deal value in H1 2019, demonstrating the resiliency of the sector, as lockdowns around the world forced workforces to work remotely and other forms of entertainment and recreation were shut down—although deal count fell slightly from 305 to 303 deals over the same period.

A US$7.6bn private equity (PE)-led take-private of 58.com, the Chinese online classifieds business, was the largest TMT deal in the first half of 2020. The deal, led by PE firms Warburg Pincus and General Atlantic, could be one of many more such delistings, as PEs take advantage of undervalued public companies. Moreover, US-listed Chinese firms in particular could be receptive to take-private offers, as geopolitical and trade tensions escalate between the two countries.

Chinese tech giant Tencent, for example, recently led a consortium that took Chinese car price comparison website Bitauto private in a deal that valued the firm at US$1.1bn in implied equity value.

India delivered the sector’s second largest deal for H1 2020 as Facebook took a

9.99% stake in Jio Platforms in a US$5.7bn transaction. Jio is the digital technology arm of Relience Industries, a telecoms conglomerate controlled by Indian billionaire Mukesh Ambani. Jio Platforms has a portfolio of digital assets that includes Reliance Jio, a mobile network that has seen user numbers swell to 388 million since its launch around four years ago. The deal will see a commercial partnership with Facebook’s messaging service WhatsApp and give the US-based social networking company a foothold in the fast-growing market in India.

In addition to Facebook’s investment, a number of PE firms and institutional investors, including KKR, Vista Equity Partners, the Public Investment Fund and Mubadala, also took up small stakes in Jio Platforms.

The largest Japanese TMT deal, meanwhile, involved automaker Toyota and telco Nippon Telegraph and Telephone (NTT), who have invested in each other to build a data platform that will be used to build a suite of smart city infrastructure and services. The deal—worth US$1.8bn—illustrates how technology has

broken down sector silos and encouraged a multidisciplinary approach to mobility and connectivity.

There was US$59.2bn worth of TMT deal value recorded in Asia in H1 2020, a 40% rise on deal value in H1 2019, demonstrating the resiliency of the sector.

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Top deals

Top 15 Announced Deals for Half Year Ending 30 June 2020 — Asia-Pacific Targets Technology, Media & Telecom Sector

AnnouncedDate


15-Jun-20 P Consortium for 58.com 58.com Inc 7,600

22-Apr-20 C Facebook Inc Jio Platforms Limited (9.99% stake) 5,708

12-Jun-20 P Consortium for Yixin Group Ltd Yixin Group Limited (77.94% stake) 3,860

9-Jun-20 C UV Asset Reconstruction Company Limited; and Aircel Limited (Financial creditors) Aircel Limited 2,632

4-Mar-20 C Tencent Holdings Ltd; SB China Venture Capital Co Ltd; Sequoia Capital China; and Hillhouse Capital Management Ltd

Tianjin Xiaowu Information Technology Co Ltd 2,400

9-Apr-20 C Toyota Motor Corporation Nippon Telegraph and Telephone Corporation (2.17% stake) 1,840

21-May-20 C Kohlberg Kravis Roberts & Co LP Jio Platforms Limited (2.32% stake) 1,512

8-May-20 C Vista Equity Partners Management LLC Jio Platforms Limited (2.32% stake) 1,512

18-Jun-20 C Public Investment Fund Jio Platforms Limited (2.32% stake) 1,489

5-Jun-20 C Al Nahdha Investments LLC; and Mubadala Investment Company PJSC Jio Platforms Limited (1.85% stake) 1,209

15-Jun-20 P Ningbo Shanshan Co Ltd LG Chem Ltd (LCD polarizer business) (70% stake) LG Chem Ltd 1,100

8-May-20 P A group of 22 investors led by Three Gorges Capital Holdings Co Ltd Unisoc Technologies Inc (13.39% stake) Beijing Ziguang Zhanxun Investment Management Co Ltd 1,041

7-Feb-20 P Alibaba Health Information Technology Ltd Ali JK ZNS Limited Ali JK Nutritional Products Limited 1,040

4-Mar-20 C SoftBank Vision Fund LP Beijing Ziroom Information Technology Co Ltd Xiong Lin (Private investor) 1,000

17-May-20 C General Atlantic Service Company LP Jio Platforms Limited (1.34% stake) 878


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H1 2020201920182017201620152014

Num

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125

38

57

31

31

4443

35

32

639

561

483

2530

2

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19

55

34

550

138

583

52

52

1520

10893 109

8

121

2732

62

201

519

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Valu

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US$44.5

US$33

US$11.8

US$8.9

US$13.3

US$35.9

US$15.3

US$40.8

US$22.2

US$37.3

US$32

US$31.3

US$33.1

US$24.7

US$13.7

US$29.9

US$16.8

US$37.3

US$32.8

US$7

US$59

US$22.5

US$12.6

US$12.6

US$56.8US$

6.6

US$12.5

US$13.9

US$19.2

US$28.7

US$13.9

US$26.3

US$27.2

US$5.9

$5m - $250m

$2,001m - $5,000m

Value not disclosed

$501m - $2,000m

$251m - $500m

> $5,001m

$5m - $250m

$2,001m - $5,000m

$501m - $2,000m $251m - $500m

> $5,001m



Mergermarket 44

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League tables

The legal advisor league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and include lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and are based on the following sectors: Computer — software, hardware and semiconductors; Telecommunications — hardware; Internet/e-Commerce; Media; and Telecommunications — carriers.

The financial advisor league tables by value and volume have been run from 01/01/2020 to 30/06/2020 and exclude lapsed and withdrawn deals. The tables are based on advice to an Asia-based bidder, target or vendor and are based on the following sectors: Computer — software, hardware and semiconductors; Telecommunications — hardware; Internet/e-Commerce; Media; and Telecommunications — carriers.




Number of Deals


2 30 Houlihan Lokey 7,923 3


4 65 Oaklins 3,868 3


6= - Moelis & Company 2,900 1

6= - The Bank Street Group 2,900 1

8 10 Citi 2,135 5


10 13 JPMorgan 1,386 4


Number of Deals



3 3 AZB & Partners 15,639 15


5 5 Paul, Weiss, Rifkind, Wharton & Garrison 11,876 6

6 6 White & Case 10,413 5



9 9 Weil, Gotshal & Manges 8,150 7

10 10 Conyers Dill & Pearman 7,923 3


Number of Deals


2 2 Deloitte 933 12

3 7 KPMG 278 7

4 8 EY 691 6

5 1 PwC 86 6


7 16 Citi 2,135 5

8 13 Sumitomo Mitsui Financial Group 656 5


10 17 JPMorgan 1,386 4


Number of Deals


2 2 AZB & Partners 15,639 15




6 6 Latham & Watkins 3,891 10


8 8 DLA Piper 878 9

9 9 Khaitan & Co 360 8


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Life Sciences & Healthcare

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HY 2020Life Sciences & Healthcare


The life sciences & healthcare sector has been on the frontlines of the response to the COVID-19 pandemic.

The scale of the virus and its impact on societies and economies has highlighted the importance of long-term investment in healthcare and pharmaceuticals infrastructure, which bodes well for sustained M&A activity in the sector.

The positive outlook for investment in the industry limited the decline in deal activity in life sciences & healthcare through the course of H1 2020—deal volume was nearly unchanged from 144 deals recorded in H1 2019 to 138 in the same period this year. Deal value for the first six months this year came in at US$15bn, 17% down on the US$18bn posted in H1 2019.

Private equity (PE) firms were particularly active in the sector. Bain Capital has bid US$1.5bn for Japanese nursing home operator Nichiigakkan, while Chinese investment firms IDG Capital and China Renaissance led a US$1bn funding round into gene-sequencing equipment group MGI Tech, and Japan’s Polaris Capital Group acquired pharmacy group and healthcare outsourcer SOGO Medical for US$858m.

Other PE deals included US-based Carlyle Group taking a 20% stake in medicine manufacturer Piramal Pharma in India; South Korean conglomerate Kolmar Korea selling

its pharmaceutical business to domestic PE firm IMM Private Equity; CVC Capital Partners investing in HealthCare Global Enterprises in India; and BGH Capital backing Healius Primary Care in Australia.

The strong interest from local and international PE firms in healthcare deals in Asia is a trend that has been mirrored globally

Documents

The comprehensive review of mergers and acquisitions in the … · 2020. 8. 13. · provide bright spots of deal activity for the sector. Across all sectors, East Asia, which includes