Private equity firms in Greater China appear to have waning appetite for overseas buyouts, with dealmaking in the region showing a marked decline this year.
Since the start of 2023, fund managers based in Greater China—which includes mainland China, Taiwan, and the special administrative regions of Hong Kong and Macao—have been involved in 38 buyouts worth a combined $6.9 billion, PitchBook data shows.
Assuming dealmaking continues at its current pace, the total number of outbound buyouts is likely to be well below that of the previous two years. In 2021 and 2022 there were 74 and 77 deals, respectively, worth $15.4 billion and $9.7 billion.
The decline in outbound acquisitions mirrors a broader decline in Chinese PE dealmaking, from previous record highs, and a slowdown in PE fundraising in the country overall.
Among the most active overseas investors are those firms that already have strong international ties. The biggest deal to close this year was Providence Equity Partners' $1.5 billion acquisition of French software firm A2Mac1. The deal included participation from Auster Capital, which has offices in Hong Kong and specializes in helping European brands expand into Asia. Another big deal to close this year was BPEA EQT's $1.25 billion acquisition of IMG Academy, a Florida-based sports education company, alongside Weatherford Capital.
BPEA EQT—the Asian private equity arm of Sweden's EQT—ranks as the most active participant in outbound buyout activity among Greater China-based firms both this year and over the previous five years. BPEA EQT has a track record of backing companies to support their cross-border activities, as does its parent, EQT.
Related read: H1 2023 Greater China Venture Report
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This article originally appeared on PitchBook News