"Asian companies will be buying more mid-market companies in the US and Europe as they become more attractive in terms of value," according to a research survey compiled by Merrill DataSite and merger market.
According to a respondent of the survey, the Asia-Pacific region is most likely to see the greatest increase in mid-market M&A activity this year.
According to the report titled Global mid-market M&A outlook, 68 per cent of respondents expect the attractiveness of mid-market targets to drive the M&A spree this year.
"Indeed, for Asian respondents in particular, the mid-market is expected to present significant opportunities," the report added.
Regarding antitrust laws, the report says about half of respondents (51 per cent) expects that these laws would not affect mid-market M&A in countries like India and China. The remaining 49 per cent of respondents are more likely to expect an increase in activity (30 per cent) than a decrease (19 per cent).
Meanwhile, in the case of private equity transactions the Asia-Pacific mid-market would see more private equity activity than North America and Europe, largely because the risk factor is low in this region.
"Overall, respondents expect the Asia-Pacific mid-market to see more private equity activity than North America and Europe, with the majority of each respondent group expecting an increase in activity," the report quoted one of the respondents as saying.
Respondents expect a broad range of factors to drive this increase like emergence of entrepreneurs mainly from India and China, besides low risk factor in the Asia-Pacific region, which makes it very attractive.
Family-owned businesses are expected by 34 per cent of respondents to be the best mid-market targets in the Asia-Pacific region this year, while eight per cent believe
state-owned enterprises to make the best targets, while the remaining respondents believe venture capital backed companies, private equity exits among others would be the most attractive targets this year.
"While 44 per cent of respondents expect to see the most mid-market M&A in the $150 million-$300 million range, only half of that group (22 per cent) expects deals to fall in the $300 million-$500 million range. The remaining 34 per cent expect the smallest range, $25 million-$150 million, to see the most activity," the report added.
Nearly half of respondents about 49 per cent expect the industrials, manufacturing and engineering sector to contain the highest number of targets in the Asian-Pacific mid-market over this year.
In terms of resilience, about 34 per cent expect Germany to be the most resilient of all European countries in terms of mid-market M&A in the year ahead. Conversely, in countries such as Italy and Spain, only 8 per cent and 6 per cent believe they would be most resilient.
