This edition looks at the wave of Chinese GPs taking a shot at Japan’s mid-market and what the billion-dollar pact between the Philippines’s sovereign wealth fund and a Thai conglomerate means for its ecosystem.
China’s GPs take it up a notch in Japan
Along with global heavyweights, PE firms with Chinese roots or a China presence, too, have been making moves into Japan’s mid-market, and cracking some very big deals.
Take Hillhouse Investment Management, which acquired Tokyo-listed real estate firm Samty Holdings for 169 billion yen ($1.1 billion) and delisted the company from the Tokyo bourse in January.
Closed PE transactions involving Chinese GPs or GPs with Chinese roots in Japan (From 2020-2025 YTD*)
FountainVest Partners, too, paired up with Japan’s Unison Capital to acquire Japanese premium pearl jewelry brand Tasaki & Co. for about 100 billion yen from MBK Partners in November 2024; while YF Fresh Future also completed the acquisition of all shares in coloured contact lenses maker T-Garden from Japan-based private equity manager Integral Corporation in the month after.
Huang Xin, partner and member of the investment committee of YF Capital, also known as Yunfeng Capital, served as the representative director at YF Fresh Future.
Still, Chinese GPs are not new in the Japanese market, and the recent deals were done by established commercial players who know how to play by the foreign direct investment rules.
But cracking the red-hot PE scene in Japan will require foreign GPs to win the battle for talent. They are vying with more established players with longer track records and deeper benches, but what talent those GPs can attract in the short-to-medium term will likely set the course for how they fare in this market.
Philippine PE push
The recent $1-billion PE pact between the Philippines’s SWF, Maharlika Investment Corp, and Thai conglomerate Charoen Pokphand (CP) Group is set to unlock even more potential in one of Asia’s fastest-growing markets. For Maharlika, which was set up just over a year ago, the deal is “a game-changing measure”.
Maharlika’s new fund is designed to attract more foreign capital. Meanwhile, CP Group’s commitment underscores the potential opportunities in the Philippines, as other markets flag. The Thai tycoon was chasing bets in high-growth markets such as Vietnam, but PE deals there have slowed.
The deal also marks a significant milestone for the Philippine government as it pushes for regulatory reform. It is the fourth in Southeast Asia to have its SWF invest in PE. Neighbouring Thailand has yet to establish an SWF, while Vietnam’s State Capital Investment Corp is focused solely on managing state-owned assets.
The partnership aims to boost investments in key economic drivers such as agriculture, digital innovation, and renewable energy, as the Philippines aims for 8% GDP growth in the next few years.
Some regional PE firms have already spotted promise in the country’s consumption story. Creador said it plans to invest up to 20 billion pesos (about $344 million) in the Philippines over the next five years. Thailand-based 9Basil, which already backed Filipino business processing outsourcing provider Sourcefit, also bets on the Philippines for its pipeline.
Growtheum Capital Partners secured its first transaction in this market in December 2024 with a 7-billion-pesos investment in cold-chain solutions provider Mets Logistics. Most recently, Aura Private Equity led an investment in fintech platform Giftaway.
Top PE updates from APAC
LPs in Asia are in a position to negotiate better terms and deals with GPs, as the region’s private equity market struggles with recovery and a dearth of capital, especially over their Western counterparts, according to Ricardo Felix, partner and head of Asia Pacific at Asante Capital.
Cathay Private Equity, a wholly owned subsidiary of Cathay Securities Investment Trust Co Ltd, is actively exploring investment opportunities in Southeast Asia in renewable energy, sustainable agriculture, and the circular economy.
Federated Hermes, a US-based investment manager, is not shying away from co-investments with emerging managers in Asia, at a time when established peers are dominating the landscape, said Sean Yoo, partner and head of APAC at Federated Hermes.
Bain Capital said it may withdraw its tender offer proposal for Fuji Soft following a higher offer from rival KKR. Bain’s potential pass up would bring an end to months of competition for the takeover of the Japanese IT firm.
Gaw Capital and Patience Capital Group have acquired a prime mall in central Tokyo, Tokyu Plaza Ginza. The deal, valued at more than $1 billion, is the latest in a slew of major transactions in Japan’s booming property market.
IPO buzz
Hillhouse-backed Mixue is preparing to go public in a $500-million listing on the Hong Kong Stock exchange. Meanwhile, Guming, backed by the likes of HongShan Capital and Coatue Management, has listed on the same bourse.
In India, EQT-backed Indira IVF; and Urban Company, whose investors include Prosus Ventures, Dragoneer, Wellington Management, Vy Capital, Tiger Global, and Steadview Capital, are also gearing up for IPOs. Temasek– and TPG-backed eyecare chain Dr Agarwal’s made its debut on Bombay Stock Exchange on February 4.
Fundraising frenzy
TPG closed nearly half of the target for its first growth equity fund for Asia that will target mid-cap investments in Australia; South Korea; and Southeast Asia, predominantly Singapore.
Hillhouse is reportedly in the market to raise $7-8 billion for its new buyout fund. The process is said to have started last month, with Hillhouse pledging to make a GP commitment of $1 billion.
Sereya Partners is launching a digital infrastructure vehicle in Japan focused on investing in data centres and broader telecommunication assets. The fund will be writing equity ticket sizes in the several-hundred million-dollar range, varying deal to deal.
What to look out for
CVC is set to host its first earnings call of the year on February 14 to announce its 2024 full-year result, while Grab will also reveal its fourth-quarter results on February 20.
Singapore’s Budget 2025 announcement is slated for February 18. The government’s long-term fiscal prudence should give it sufficient flexibility to support businesses and households through inflationary pressures and broader economic and geopolitical challenges; as well as further investment into driving the city-state’s long-term global competitiveness.
On the same day, Temasek-linked Azalea is scheduled to have its annual investor presentations.
People moves
LaSalle IM has reshuffled its APAC leadership. Its head of APAC, Keith Fuji, will assume the chairman’s role for the region in July, while Claire Tang, co-CIO for APAC and head of Greater China, is set to leave at the end of this month after spending about 18 years at the firm.
Seoul-based Steve Hyung Kim has stepped up as Asia-Pacific co-CIO this month alongside Tokyo-based Kunihiko (Nick) Okumura, who shares the same role. The duo will continue to head the local teams in their respective locations.
Beyond the buyout is our weekly newsletter dedicated to private equity developments across Asia Pacific, with a special focus on Southeast Asia.
