JPMorgan’s regional strategist Chatterji forecasts a gradual rebound in M&A activity across the Asia-Pacific region, with deal volumes expected to rise 12% year-on-year in 2026. The outlook hinges on stabilization of interest rates and improved corporate balance sheets.
- M&A deal volume in APAC projected to grow 12% YoY in 2026
- Total deal value expected to reach $1.4 trillion in 2026
- Technology sector accounts for 41% of deal value, up from 34% in 2024
- Net debt-to-EBITDA ratio across top 500 APAC firms fell to 2.8x in Q4 2025
- India and Southeast Asia leading domestic consolidation trends
- Equity indices in Hong Kong, Tokyo, and Sydney up 9.3% YTD
JPMorgan’s Chatterji has issued a cautiously optimistic outlook for merger and acquisition activity across the Asia-Pacific region, projecting a 12% increase in transaction volume during 2026 compared to 2025 levels. This uptick follows two years of subdued dealmaking driven by elevated financing costs and geopolitical headwinds, particularly in China and Japan. While cross-border deals remain constrained, domestic consolidations in sectors like technology and healthcare are gaining momentum. The forecast is anchored in recent improvements in corporate profitability and reduced leverage among mid-cap firms. According to internal JPMorgan analytics, net debt-to-EBITDA ratios declined to 2.8x across the region’s top 500 listed companies in Q4 2025, down from 3.6x in early 2023. This structural improvement supports increased confidence in strategic transactions, especially in India and Southeast Asia where regulatory environments have stabilized. Deal values are projected to reach $1.4 trillion in 2026, with technology-driven acquisitions accounting for 41% of total value—up from 34% in 2024. Notable potential transactions include a possible consolidation in India's semiconductor ecosystem and an anticipated bid for a major Japanese logistics firm by a Singapore-based investor group. These developments reflect growing appetite for high-growth, asset-light business models. Market participants, including private equity firms and sovereign wealth funds, are adjusting their capital deployment strategies accordingly. Equity markets in Hong Kong, Tokyo, and Sydney have already shown early signs of recovery, with MSCI Asia Pacific Index up 9.3% year-to-date. However, volatility remains elevated due to ongoing central bank policy divergence, particularly between the U.S. Federal Reserve and Bank of Japan.