Asia-Pacific M&A Volumes Rise 19% in Q1 2025, Outpacing US and Europe

Asia-Pacific Leads Global M&A Recovery in Q1 2025

Asia-Pacific recorded a 19% increase in M&A volumes during Q1 2025 compared to the same period in 2024, outperforming both the United States (up 13%) and Europe (down 14%), according to data compiled by Bloomberg. The region's strong showing marks a notable reversal of the multi-year trend in which Western markets dominated global dealmaking, and signals a potential structural rebalancing of global M&A flows toward Asia.

The outperformance was underpinned by a combination of large-scale transactions, supportive macroeconomic conditions in key markets, and a deepening pool of financial and strategic acquirers active across the region.

Blockbuster Transactions Anchoring the Quarter

Q1 2025 figures were bolstered by several pending blockbuster transactions that captured global attention. CK Hutchison's port assets sale, one of the most significant infrastructure transactions in recent memory, contributed meaningfully to regional deal value. The transaction, involving the divestiture of strategic port operations across multiple geographies, attracted interest from sovereign wealth funds, infrastructure investors, and strategic buyers.

The Seven & i restructuring, driven by the Ito family's effort to take the convenience store giant private while fending off a competing bid from Alimentation Couche-Tard, represented another landmark transaction. The deal's complexity, involving cross-border financing, regulatory considerations, and competing stakeholder interests, underscored the increasing sophistication of Asian M&A.

These transactions, along with several other billion-dollar-plus deals, provided the foundation for the region's strong quarterly performance.

Strong Pipeline and Banker Optimism

Jan Metzger, Citigroup's co-head of investment banking in Asia Pacific, described the current deal pipeline as "one of the strongest I have seen." This assessment reflects not only the volume of transactions in market but also the quality and strategic importance of the deals under discussion.

Advisory firms across the region have reported elevated levels of engagement from both corporate clients and financial sponsors. The breadth of mandates spans traditional M&A advisory, take-private support, divestiture planning, and defense advisory, indicating a market operating on multiple fronts simultaneously.

Japan Leads, India and Australia Contribute Strongly

Japan accounted for the largest share of regional deal value during Q1 2025, continuing the trend driven by corporate governance reforms and private equity interest. The combination of willing sellers, attractive valuations, and a deep universe of potential targets has made Japan the most active single market in the Asia-Pacific region.

India contributed strongly to regional volumes, with deal activity fueled by robust economic growth, a thriving technology sector, and increasing private equity penetration. Indian companies have become both active targets and increasingly confident acquirers, adding depth to the market.

Australia saw elevated activity concentrated in mining, energy, and infrastructure sectors. The country's resource wealth, stable regulatory environment, and established capital markets continue to attract both domestic and international dealmakers. Several significant mining sector consolidation transactions contributed to Australia's share of regional volumes.

Mixed Picture Across Southeast Asia

Southeast Asia presented a more mixed picture during Q1 2025. Singapore demonstrated healthy growth, benefiting from its position as a regional financial hub and the ongoing wave of data center and digital infrastructure investment. Vietnam showed encouraging activity, driven by manufacturing sector investment and the continued migration of supply chains into the country.

By contrast, Thailand and Indonesia exhibited more modest M&A activity. In Thailand, political uncertainty and slower economic growth weighed on deal sentiment. In Indonesia, while the long-term opportunity remains compelling, execution challenges related to regulatory complexity and valuation expectations continued to moderate transaction volumes.

Reversal of a Multi-Year Trend

The Asia-Pacific outperformance in Q1 2025 reverses a multi-year trend in which Western markets, particularly the United States, dominated global M&A activity. For much of the post-pandemic period, US deal volumes were buoyed by a combination of abundant capital, favorable credit conditions, and a deep pool of actionable targets. Europe, meanwhile, maintained steady if unspectacular activity levels.

The shift toward Asia-Pacific reflects several structural dynamics. Corporate governance reforms in Japan have unlocked a vast market. India's economic growth trajectory provides a compelling backdrop for investment. The digital transformation of Southeast Asian economies is creating new deal opportunities. And the region's growing pool of domestic private equity and sovereign wealth fund capital provides a self-reinforcing source of dealmaking momentum.

Implications for the Remainder of 2025

The strong Q1 2025 performance sets a favorable tone for the remainder of the year. With large transactions still in process, active pipelines across major markets, and supportive macroeconomic conditions in most regional economies, advisors and investors expect Asia-Pacific M&A volumes to remain elevated.

However, risks remain. Geopolitical tensions, particularly those involving China, could dampen cross-border activity. Rising interest rates in some markets may affect leveraged transaction economics. And regulatory developments across the region continue to evolve, requiring careful navigation by dealmakers. Despite these headwinds, the overall trajectory for Asia-Pacific M&A appears firmly positive.