Although there has been less M&A in the Asia Pacific and
Australian markets during the financial crisis, there are
pockets of resistance in which buyers are willing to purchase
choice assets at attractive (but often volatile) valuations. A
tightening of credit means different potential purchasers, with
private equity relegated to the sidelines by a lack of
liquidity, and even sovereign wealth funds hesitant; in their
place are cash-rich corporates. The balance of power is also
shifting back towards the buyer, which will be reflected in the
terms on which deals are completed.
The road to here To appreciate the progression in this
market, it is necessary to understand the position from which
deal terms are moving. The second half of 2007 saw deal volumes
peak in each of Asia Pacific, the UK and Australia. In what was
a clear seller's market, big valuations were accompanied by a
deterioration in buyer...