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Alternative Market Briefing

As Asian private equity heats up, investors may have to get creative

Thursday, May 23, 2019

Bailey McCann, Opalesque New York:

Investments in Asian private equity hit new highs in 2018, according to recent data from Bain & Company. With $883 billion in total assets under management, Asia-Pacific now represents 26% of the global PE market, up from only 9% just a decade ago. As GPs compete for deals against corporate players, increasingly they are winning. Private equity's share of the Asia-Pacific M&A market also rose 6 percentage points to 17% in 2018, from the previous five-year average of 11%.

These trends come as no surprise to delegates at the recent Opalesque Hong Kong Roundtable. They suggest that there is a long runway for investing in the region but in order to be successful, investors will have to get more creative.

"For someone looking to get exposure to Asian private equity in a conventional way, my own view is that they should focus on specific niche segments of the market," said Hugh Dyus, a Partner at Navis Capital Partners. "One area would be buyout managers who are disciplined in sticking to control investments. Another area would be early stage VC managers." Dyus adds that buyout and early stage VC managers don't carry some of the risks of growth capital managers which have raised megafunds in recent years and are facing increasingly steep competition for deals. Prices in the Asia-Pacific region remained high in 2018, according to Bain and......................

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