A rising trend of consolidation amongst Asian companies have led to a paradigmatic shift in cross-border M&A deal flows as well as increasing the demand for intra-Asian legal advice served.
In the latest mergermarket report, Asian firms have crept into the top 10 deal value rankings. Singapore firm Wongpartnership jumped to second from 20th place on volume rankings compared to the same period last year. Kim & Chang retained a top three spot and Amarchand & Mangaldas & Suresh A Shroff & Co as well as Lee & Ko made eight and ninth spots respectively.
Conversely, Debevoise & Plimpton, Slaughter and May and Norton Rose dominated the top 10 chart for M&A deal values in Asia with the most improvement, making giant strides of 87 places (to finish 2nd), 38 places (to finish 3rd) and 48 places (to finish 7th), respectively.
“It’s an increasingly competitive market, particularly in Singapore because not only do you see the rise of Asian firms coming into league table as shown in the report, but also increased presence and resourcing amongst the international firms,” Norton Rose corporate partner Jill Gauntlett told ALB yesterday.
“The fact that [Asian firms] are seeking bigger market share is not necessarily indicative of discouragement to the international firms. In fact it’s quite the reverse. International firms increasingly see Singapore as an important regional hub,” Gauntlett said.
“Clearly Asian firms are responding to the vibrant activity in the [Asian] market by strengthening their offering but so too are the international firms,” she said.
According to some partners, greater caution is being seen in the marketplace by buyers taking longer to undertake financial and legal due diligence before signing on the dotted line.
“Deal flow is up on last year and the pipeline is looking much healthier but some deals are taking longer reflecting underlying caution,” Gauntlett said.
Other observers echo this sentiment.
“I think people are not willing to overpay right now. The last 18 months have required people to be more cautious on the diligence, timing of things and certainly private equity is taking a deeper view on how they look at value,” DLA Piper Asia managing director Alistair Da Costa said.
“But at the same time, there is value. What has happened over the last 18 months is that valuations have become a little more realisitic because they’ve had to. This has given the opportunity for people to look at how they can construct deals,” he said.ALB
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