Tech M&A in Asia at record high, main deal driver in the region – industry 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.

FILE PHOTO: FILE PHOTO: A Grab logo is pictured at the Money 20/20 Asia Fintech Trade Show in Singa

FILE PHOTO: A Grab logo is pictured at the Money 20/20 Asia Fintech Trade Show in Singapore March 21, 2019. REUTERS/Anshuman Daga

HONG KONG: 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 US$136.2 billion in 2020, more than double the year-ago levels, according to data provider Dealogic.

Tech deals accounted for 28per cent of the regions’ overall M&A transactions, which totalled US$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, 92per cent said technology, media and telecoms companies would drive their own deal activity, while 57per cent 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.



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