SG topped in PE-VC deals, Indonesia clocked most IPOs in SE Asia this year

The total value of M&As, private equity, and venture capital deals, and initial public offerings (IPOs) in Singapore, Malaysia, and Indonesia stood at $280 billion across 1,800 deals between December 2020 and November 2021, according to a new report by the research firm Duff & Phelps.

Transactions this year were 3.3 times the $84 billion recorded last year, amid pent-up demand and greater exit opportunities, according to the report titled ‘Transaction Trail Report 2021’.

Singapore accounted for the majority of 2021’s transactions (63.3% by volume) although Indonesia and Malaysia saw more initial public offerings (IPOs) in the period.

“With the world taking tentative steps towards trying to get to a new normal of living, we are also seeing a new normal for doing transactions,” Srividya Gopal, a managing director at Duff & Phelps said in a statement.

“While transaction activity is cyclical, and we may not see historical records every year, we expect to see continued strong deal momentum in the region, driven by the availability of capital resources and allocations, a dynamic political climate, regulatory changes in China channeling more transactions to the region and a rapid increase in technology adoption,” she added.

M&A activity

More than $250 billion worth of M&As across over 1,300 deals took place in the three countries, rebounding sharply from 2020’s $74 billion from 798 deals.

Notable M&As in the last year include:

• Grab’s merger with the special purpose acquisition company (SPAC) Altimeter Growth Corp valued at $39.6 billion
• GIC’s participation in two big buyouts — medical supply company Medline Industries for $34 billion, and cybersecurity firm McAfee for $12 billion,
• the $12 billion proposed merger between Malaysia’s Digi.Com and Celcom Axiata, and
• Indonesia’s Gojek and Tokopedia’s $18 billion merger

Asia-Pacific accounted for 23% of global M&As in the year.

PE and VC deals

Private equity and venture capital fundraising activity recovered strongly amid greater digitalisation in the region.

More than $24 billion was raised — almost three times more than in 2020, and the highest since 2017 — across 450 deals in the three countries. Technology deals accounted for 64% of all investments.

Southeast Asia minted at least 21 unicorns in 2021 alone, according to DealStreetAsia DATA VANTAGE‘s Private Capital Markets Report 2021. Since the report, Sky Mavis has also reached a valuation of more than $1 billion. This is nearly the same number of unicorns made between 2013 and 2020.

Other companies said to have surpassed a valuation of more than $1 billion are Kopi Kenangan and Sociolla, according to sources DealStreetAsia previously spoke to.

The biggest fundraises include Grab’s $4 billion private placement as part of its SPAC merger, J&T Express’ $1.8 billion raise in April, GoTo’s recent $1.3 billion pre-IPO round, and large deals of more than half a million each from unicorns Emeritus, Trax, and Ninja Van.

IPOs

Indonesia dominated the IPO market with 51 public listings that raised $3.8 billion this year. The archipelago accounted for 66% of the total IPOs among the three countries.

The biggest listings in Indonesia and the region came from Bukalapak and Mitratel, which raised $1.5 billion and $1.3 billion respectively.

Listings in Singapore, which saw 10 IPOs raising $1.3 billion, were dominated by real estate investment trusts, or REITs.

While listings in Singapore were subdued, many tech companies headquartered or registered in the country looked overseas to list. Besides Grab, other companies that have agreed to merge with a SPAC include crypto mining platform Bitdeer, which plans to merge with Blue Safari Group Acquisition Corp in a $4 billion deal; SES Holdings; Kredivo’s FinAccel; and PropertyGuru.

The US still dominates the SPAC market with 728 SPAC listings in 2020 and 2021. Only nine and three SPAC listings originated from Singapore and Malaysia that raised $1.1 billion and $425 million respectively during the same period.

Some of these SPACs include L Catterton Asia Acquisition Corp’s listing on the Nasdaq targeting high-growth consumer technology companies in Asia that raised $250 million, and Catcha Investment Corp’s SPAC that raised $275 million looking for a “new economy” company in Southeast Asia or Australia.

“With the launch of the SPAC regime by the Singapore Exchange recently, we expect to see an even more robust pipeline for SPAC listings and de-SPAC transactions in the near future,” said Gopal.