The total value of merger-and-acquisition transactions in Asia, excluding Japan, for 2021 is expected to be 20 to 25 percent more than it was last year, UBS forecast in a telephone meeting on Wednesday.

In the first half of the year, the value of M&A transactions in the region increased by 69.6 percent year-on-year, the investment bank said.

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With some mainland property companies facing debt problems, the property sector could see more M&A deals in the near future, mainly for property management and logistics businesses, said Samson Lo, UBS’ head of Asia M&A.

With some mainland property companies facing debt problems, the property sector could see more M&A deals in the near future, mainly for property management and logistics businesses, said Samson Lo, UBS’ head of Asia M&A

Debt problems in some mainland property companies have prompted a number of M&A-related activities, with debtors seeking funds to repay their debts and therefore selling assets within a short period of time, he said.

Political factors have also contributed to the increase in M&A deals, he added. Because of continued tensions between China and the United States, some Chinese companies planned to sell their US operations that had been acquired in recent years but not consolidated, while some US companies also considered selling their respective businesses in China.

Lo said he expects the number of M&A deals to continue to rise in the coming year, fueled by de-SPAC transactions, transnational companies’ spinoff of China businesses, privatization, etc.

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The trend of Hong Kong-listed companies seeking privatization will play a role in the growth of M&A activities, he said.

There are currently roughly 160 Hong Kong-listed companies whose major shareholders own over 70 percent of the stake. Some of them could seek privatization as their performance on the stock market has been bleak due to the social unrest, the Sino-US trade war, and the ongoing impact of the coronavirus pandemic, he said.

suzihan@chinadailyhk.com