Mergers & acquisitions

In a bid to increase their market share or acquire new skills & expertise, consulting firms regularly turn to mergers & acquisitions. Globally, consulting firms closed over 2,900 deals last year, of which 267 in Asia-Pacific, according to data from Equiteq. The average deal size in Asia-Pacific is $14.5 million, compared to for instance $8 million Europe and $12.2 million in North America.

The number and average value of deals in the Asia-Pacific rose last year, with Singapore being one of the best performing countries in the region. This robust deal activity was evident across all segments apart from media. Australia is a consulting market that is observing strong growth, particularly within hot areas like digital consulting, and advisory to the energy, mining and financial services sectors. While M&A volumes in Australasia fell, average values rose substantially particularly in management consulting and engineering consulting.

Cross-border deals represented over half of all the M&A activity in Asia-Pacific and Australasia last year. Consulting markets, such as Australia and Singapore, offer gateway opportunities for European and North American buyers, who can develop a footprint in the wider Asia-Pacific region with access to faster growth.

Vice versa, there was substantial activity from cash-rich Indian and Japanese buyers investing into western consulting markets, as evidenced by landmark cross-border acquisitions from NTT, Wipro and Dentsu. There was also strong cross-border activity within engineering consulting as buyers extended their reach into regions expecting increased infrastructure spending over the coming years.