Deal activity in Asia-Pacific drops by 20.4% in 2023; India's venture capital funding plummets

In 2023, the Asia-Pacific (APAC) region, encompassing economic giants India and China, witnessed a substantial 20.4% decrease in deal activity, mirroring a global trend, according to data from the analytics firm GlobalData. The analysis revealed a decline in all deal types, with a total of 14,193 deals, including mergers & acquisitions (M&A), private equity (PE), and venture capital (VC), compared to 17,824 deals in the previous year.

Breaking down the figures, M&A deals experienced a 13.5% decrease, while both PE and VC deals saw sharper declines of 24.7% and 26.3%, respectively. The slump was pervasive across major markets in the APAC region, with China, India, Japan, Australia, South Korea, Singapore, Hong Kong, Indonesia, and New Zealand witnessing drops ranging from 13.6% to 34.2% in deal volume compared to 2022.

Earlier reports from GlobalData had already flagged a significant decline in VC funding in India during the first three quarters of the year (Q1-Q3). Notably, India recorded 811 VC funding deals amounting to $5.5 billion, marking a stark 42.3% year-on-year decrease in deal volume and a substantial 70.4% drop in disclosed funding value compared to the same period in 2022.

Aurojyoti Bose, Lead Analyst at GlobalData, attributed this global downturn in deal-making activities to a range of factors, including macroeconomic challenges, inflation, high interest rates, recession fears, and ongoing geopolitical conflicts. Particularly, PE/VC firms faced a significant operational drop as investor sentiment took a hit.

The data, analysis, and solutions provided by GlobalData are utilized by approximately 4,000 of the world’s largest companies, boasting a client base that includes 70% of FTSE 100 and 60% of Fortune 100 companies.

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