Southeast Asia’s private equity scene is entering choppier waters as the turbulence caused by Trump’s tariffs injects fresh volatility into global markets, shrouding the exit landscape, which was beginning to pick up in roughly the past six months.
“The [private equity] market was picking up during the end of last year and the beginning of this year,” said Bain & Company’s partner Tom Kidd. Exit value in the region rose year-on-year by about 30% to $4.7 billion in 2024, according to his company’s latest report Southeast Asia Private Equity 2024 in Review.
The bulk of that value was driven by KKR’s $1.1 billion divestment of PropertyGuru to EQT and Affinity’s $966 million sale of Island Hospital.
Exit count in 2024 surged by 67% to 15 deals from the previous year, just shy of the 2019–2022 average of 18.
Rebounding market conditions in Southeast Asia were underpinned by valuation recovery in private equity-backed M&A transactions in the Asia Pacific region that saw median EV/EBITDA multiples jump to 12.8x from 10.3x in 2023.
But the recent tariff announcements by the Trump administration are putting a brake on that improving momentum in the near-term as investors are wrapping their heads around the escalating trade war.
“This has changed even from Wednesday to Thursday. Everyone woke up and looked at their phones today [Thursday] and the situation was already very, very different. You’re going to see that uncertainty persist in the near term and that’s going to start to slow down the gears of the deal markets,” Kidd said at a media briefing in Singapore the morning after US President Donald Trump authorised a 90-day pause in additional tariffs on over 75 nations that did not retaliate against US’ latest trade measures.
Lingering dealmaking uncertainty could further extend already-lengthy holding periods in APAC, potentially slowing capital raising from limited partners. Almost 60% of seven-year-old investments made in 2017 are still sitting in fund managers’ portfolios as of 2024, potentially dampening the internal rate of return at future liquidity events, per Bain data.
“The recently announced tariffs are adding another layer of complexity to dealmaking in Southeast Asia. To start, we are seeing our clients proactively assess the first and second order impact of tariffs on their portfolios in the region, ” said Usman Akhtar, head of Bain & Company’s SEA PE practice.
Infra drives dealmaking
In line with the exit activities in 2024, Southeast Asia witnessed a rebound in new PE dealmaking, which reached $15 billion in value, per the Bain report. This marked a 67% year-on-year increase from $9 billion in 2023, driven by major infrastructure investments like KKR’s transaction in ST Telemedia Data Centres and BlackRock’s deal in Ditrolic Energy.
Digital infrastructure emerged as one of the hottest sectors last year, with transactions reaching up to $3.5 billion, regaining 2022 highs thanks to transactions in data center assets and telecommunications towers, said the report.
Meanwhile, the utilities and renewables sector accounted for over half of the $2.6 billion transactions made in the energy and natural resource sector last year.
“We’re starting to see the underlying infrastructure base for Southeast Asia evolve and part of that is changing the grid and the sources of power generation. That trend has occurred in other markets around the world despite some of the recent changes in policies in departments like the United States. We’re really starting to see that play out in Southeast Asia,” said Kidd, who pointed to the surge in investment activities in solar projects.
