4 Asian Legal Business | October 2024 The Briefs (Reuters) Cross-border mergers and acquisitions involving companies in the AsiaPacific region have recovered this year and are booming in Japan as businesses seek new growth after adjusting to cope with higher interest rates. The total announced value of such deals rose 25 percent year-on-year to $286 billion as of Sept. 30, LSEG data showed, with around 80 percent of them transacted with an entity outside the region. “There has been a notable pick-up in cross-border transactions as political stability returned to some markets just as pent-up demand for investments and dealmaking and adjustments to higher interest rates began to drive M&A activity again,” said Andre Gan, an M&A partner at Wong & Partners, a member law firm of Baker McKenzie in Kuala Lumpur. Overall, Asia M&A totalled $622 billion in the first nine months of the year, down 0.2 percent from the same period in 2023, LSEG data showed. The cross-border recovery was partly boosted by a number of mega-deals, including Canadian firm Alimentation Couche-Tard ‘s $38.5 billion all-cash takeover bid for Japanese convenience store owner Seven & i Holdings, opens new tab, the largest announced M&A deal globally this year. Japan is going to drive the region’s multibillion-dollar deals, bankers said, as relaxed corporate governance rules have made its public companies more open to takeovers, while some of the local champions are seeking to expand overseas. Japan’s inbound M&A surged more than 16-fold so far this year to a record $74 billion, while outbound deals were up 49 percent to $50 billion, LSEG data showed. Texas-headquartered real estate investor Hines, which owned and operated $93 billion worth of assets as of June 30, is actively looking for opportunities globally including Asia, its Asia chief investment officer Ng Chiang Ling told Reuters this month. Having acquired some assets in Japan and Singapore this year, Hines also sees opportunities in Australia, Ng said. In Southeast Asia, cross-border transactions are picking up. German insurer Allianz, opens new tab announced in July that it was planning to buy a majority stake in Singapore’s Income Insurance for about $1.6 billion to strengthen its foothold in Asia. “Looking forward, 50% of the APAC pipeline is made up of global cross-border transactions,” said Rohit Satsangi, Deutsche Bank’s co-head of M&A, Asia Pacific. Satsangi said he expected a resurgence of outbound activity by state-owned companies in China that are searching for renewable and natural resources assets globally. A bounce in China would be welcomed by dealmakers. China outbound deals totalled $14 billion so far this year, down 8 percent year-on-year and were at the second-lowest level in the last decade, LSEG data showed. Wong & Partners’ Gan said the overall outlook for M&A in the region was expected to improve, including for deals that did not cross borders. “Heading into 2025 and 2026, considering the recent easing of interest rates by the U.S. Fed and conclusion of the U.S. elections in late 2024, we expect continuing stability to lead to a resurgence of M&A activity,” he said. Cross-border M&A recovers in Asia as dealmakers look abroad for growth In the news 1 Cleary Gottlieb Steen & Hamilton will create a new category of non-equity partners, becoming the latest major U.S. law firm to move away from the traditional single-tier structure. Rival leading firms, including Wilmer Cutler Pickering Hale and Dorr, have also recently added non-equity partner tiers. Paul, Weiss, Rifkind, Wharton & Garrison and Cravath, Swaine & Moore have reportedly created a salaried partner tier in recent years. 2 Hogan Lovells will wind down its offices in Warsaw, Johannesburg and Sydney, citing a desire to focus on “strategic markets.” The firm said it will close the three locations “in the coming months,” without identifying any reasons for the individual closures. Its website lists 33 lawyers in Warsaw, 19 in Sydney and nine in Johannesburg. A firm spokesperson said about 65 lawyers and 58 support staff will be affected by the closures. 3 Freshfields Bruckhaus Deringer has announced a rebranding initiative, changing its legal name to simply “Freshfields” and introducing a new black-and-white logo. The firm, which is the oldest among the Magic Circle with origins dating back to 1743, says the new brand aims to reflect its current identity and future ambitions.
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