A maturing market Asia – Pacific private equity outlook 2014


February 10, 2014

Investors are becoming more sophisticated
An interesting Asia-Pacific survey that was undertaken by Ernst & Young for 2014 has been released.


The private equity story in Asia-Pacific is a coming-of-age tale, one of demonstrated growth not only in volume and value terms, but also in the market’s maturity. Investors are becoming more sophisticated, utilizing new means of investment to tap the region’s potential. Emerging markets like Greater China and India present ample opportunities for general partners (GPs) and institutional investors.


Former frontier markets, such as those in Southeast Asia, continue to move to the top of investor agendas. More importantly, regional business leaders are developing a more comprehensive understanding of the private equity model. While a full embrace is still in the making, the benefits that private equity offers — in capital, talent and expertise — are causing a noticeable shift in attitude toward foreign and domestic PE firms alike. Investor confidence and overall optimism for the year ahead remain high. Growing economies are creating new business opportunities.


Improving market conditions will provide the needed encouragement for new investments in 2014. Equally, robust credit markets are making capital more accessible and hold the potential to facilitate an increase in deal-making going forward. As a result, 76% of respondents in this year’s survey had high expectations that private equity deal activity in 2014 will increase.


For the most part, this sentiment toward improved investment has remained unchanged over the past two years — 86% for the 2013 outlook and 70% for 2012 — with survey participants notingthat volatility in Western markets and Asia-Pacific’s abundance of investing opportunities will continue to draw PE dollars. Respondents in this year’s survey also revealed several interesting developments they expect in the year ahead.

Find the survey for free download here.

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