Asia-Pacific private equity outlook 2013

Our 2013 survey finds most respondents believe Asia-Pacific should remain a relative bright spot in the global economy.

Key takeaways:

  • Asia-Pacific’s PE market remains vigorous

More than 85% of respondents say PE activity will increase over the next 12 months.

  • Greater China is the most active market

70% expect Greater China to see the most activity, despite concerns over the regulatory environment.

  • Capitalizing on the rise of the consumer

Energy, mining and utilities and consumer sectors will attract the most interest.

  • Deal sizes and valuations rise

Most respondents believe the valuation gap will remain about the same as previous years, allowing deals to close.

  • Expectations on exit routes are shifting

Respondents expect fewer exit opportunities via IPO in 2013. Exits to strategic buyers, however, are expected to increase.

  • Capital flows will be greater than in 2012

Investor allocations to Asia-Pacific PE funds are expected to rise, and funds raising capital should meet or slightly exceed fund-raising targets.

  • Due diligence is the most important consideration

Due diligence processes of GPs topped the list of factors for fund investors making new allocations.

  • Competition for assets is heating up

Besides other PE investors, corporate acquirers will offer the most competition. Sovereign wealth funds will also provide competition in certain sub regions.

  • The Asia-Pacific PE industry continues to evolve

By driving value creation in portfolios, internal operating partners will play an increasingly important role. PE firms will also diversify their offerings to create value.

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