Japan bucks private equity slowdown in Asia Pacific with deal value soaring 183% last year

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The total value of private equity deals in Asia Pacific last year fell to its lowest since 2014 as fundraising dropped to a 10-year low amid slowing growth, high interest rates and volatile public markets, according to management consultancy Bain & Company.

Japan though, was an outlier, with deal value jumping 183% in 2023 from a year earlier, making it the largest private equity market in Asia Pacific for the first time, according to Bain's 2024 Asia-Pacific Private Equity Report released Monday.

Japan is an attractive investment due to its deep pool of target companies with «significant pool for performance improvements» and corporate governance reform pressure on Japan Inc to dispose of non-core assets, Bain said.

Overall, deal value in the Asia-Pacific region declined more than 23% to $147 billion from a year earlier. This is also 35% below the 2018-2022 average value — a pace of decline that's consistent with the global slowdown — and nearly 60% lower than the $359 billion peak in 2021, Bain said.

Exits plunged 26% to $101 billion in 2023 from a year ago — of which 40% were via initial public offerings. Greater China accounted for 89% of the IPO exit value in Asia Pacific, with a vast majority listing in Shanghai and Shenzhen. Excluding Greater China IPOs, the total Asia-Pacific exit value was $65 billion.

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