Regulators restrict distressed investment in Asia

Author: Brian Yap | Published: 8 Mar 2017

Market and regulatory factors, coupled with weak legal frameworks in Asia that don’t protect creditor rights generally, have restricted the growth of distressed M&A in the region. That was a message voiced by panelists at IFLR’s Asia M&A Forum in Hong Kong last week.

Panelists at IFLR's Asia M&A Forum think regulators have restricted distressed M&A growthData from Dealogic show that, since the beginning of last year, sponsored acquisitions or distressed buyouts reached 596 totaling $1.6 trillion, with Australia taking up 120 deals worth $375 billion.But some panelists pointed out that many foreign limited partnerships (LPs) have, in the past decade, shifted away from foreign funds to domestic funds, which had a local advantage. This has largely been due to political backlash against these deals, and regional regulators’ moves to shut down their special situation funds after the global financial crisis....