Staff Reporters
Jul 25, 2018

Holding companies drive APAC M&A activity: R3

Acquisitions in the region are up 15% year over year, and in sharp contrast to global trends, holding groups are leading the way, according to R3.

Holding companies drive APAC M&A activity: R3

While "unconventional" buyers and martech firms led a massive 88% global increase in M&A activity in the first half of 2018, the value of deals in APAC increased by a more modest 15%, with traditional holding companies leading the spending, according to R3's latest M&A League Report. 

The total deal value in APAC increased from $791 million in the first half of 2017 to $908 million this year, and in China from $331 million to $399 million.

“Agency holding groups were very active in APAC in the first half of this year,” said Sabrina Lee, managing director of R3 China. “They invested nearly $100 million in creative full-service agencies, but also made significant acquisitions in the digital and martech space, signifying the importance they place on having well-rounded capabilities to serve their clients in the region.”

Agency hold groups accounted for $273 million of the deal value and 15 out of the 35 deals. So-called unconventional buyers were not far behind in terms of deal value, but only accounted for four deals. The region's largest deal involved an unconventional buyer, Suzhou Jinfu New Material, which acquired Gong He Sheng Shi in China for $156 million.

The biggest deal among holding companies came from Hylink Group following its IPO: it acquired Longfan Media for $56 million. This was closely followed by Hakuhodo, which acquired Vietnamese IMC group Square Communications for $53 million.


In terms of what types of companies are being acquired, 30% of the deals fell into the 'others' category, which includes research firms, direct marketing, healthcare marketing and media owners, among others. This contrasts sharly with the overall global trend, which  saw increased demand for martech and digital full-service firms.

“The demand for local media specialists drove a large percentage of the marketing M&A activity in the first half of this year,” Lee said. “The unique media landscapes of several APAC markets – particularly China – are driving consultancies and unconventional buyers to seek out experts in this space to boost their own capabilities.”

See more Top of the Charts


Related Articles

Just Published

1 hour ago

Account managers could be ‘squeezed out’ of ...

“To be honest, no one has ever really explained what the account management team does,” said one procurement lead.

2 hours ago

Vivo to continue as lead sponsor for the Indian ...

The IPL Governing Council was reviewing sponsorship deals from Chinese companies following the border skirmish between India and China

11 hours ago

Move and win roundup: Week of August 3, 2020

Mediamath, Drizzlin Media, Danone-AQUA, Ogilvy, Cars24, Australian Sports Club, SportsFive, Taiwan Creative Content Agency, Catchplay and Screenworks Asia kick-off our weekly move and wins roundup.

12 hours ago

Manulife's former Asia-based CMO moves stateside to ...

Francesco Lagutaine has relocated to Buffalo, NY after more than a decade in Asia, across Hong Kong and Singapore.