China Private Equity Report 2023

China’s private equity (“PE”) industry faced strong headwinds in 2022 due to factors including a slowing economy, Covid-19 restrictions, increased regulatory scrutiny, and higher prevailing interest rates globally which weighed on public market valuations. PE exits and fundraising had been challenging during the past year.
However, the China market underwent a dramatic change in recent months as the country’s Zero-Covid policy was relaxed and borders were reopened. The Chinese government implemented measures to boost the economy and private sector investments. This report provides our perspectives on how these changes may impact PE activities and China M&A market in 2023. 

The key takeaways in this report are: 

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BDA PE Conference: The premier Asian deal networking event for PE investors

This year’s BDA PE Conference saw 52 leading private companies conducting one-on-one meetings with more than 300 Asian and global PE investors in Shanghai and Singapore. More than 50 senior bankers from BDA’s global team were also in attendance.

Presenting companies
GPs and Investors
Senior PE investors
>US$10bn of EV>US$12bn of dry power300+ 1×1 meetings

Paul DiGiacomo, Managing Partner and Head of the Financial Sponsors Group, BDA Partners, said: “Every year our flagship PE Conference has grown, and this year we had a great line-up of companies presenting across the consumer, health, industrial, services and tech sectors.”

“We were also pleased to see some companies and management teams participating again as presenters after having presented at previous conferences. It signals that they find this event to be a worthwhile use of their time. It also is indicative of the growing recognition in Asia that private equity has an important role to play as good owners of high-quality companies over a long term. We are starting to see more companies in Asia successfully transition to their 3rd or 4th private equity owner in a row, a trend which we believe is set to grow.”

“Thank you for the support from all our participants, presenting companies, investors and our colleagues to make this event a great success. We look forward to seeing you all again at the 2023 BDA PE Conference.”

A rapidly expanding middle class with increased health awareness post-pandemic will continue to fuel demand for higher standards in all aspects of healthcare in Vietnam, making the country a favorite investment destination. At BDA Partners, we have seen strong interest from both financial sponsors and strategic investors to gain exposure to the sector, and we believe that there remains an abundance of M&A opportunities across various healthcare verticals.

Healthcare services – Key M&A volume driver

Historically, transactions involving private hospitals and clinics have driven deal volume in Vietnam, and this theme is expected to persist given favorable market dynamics. Vietnam’s aging population with increased health awareness and growing income level have created unmet demands for high quality healthcare services. On the supply side, the issue of overcrowding at public hospitals in major cities persist. According to the General Statistics Office[1], Vietnam has 3.1 hospital beds per 1,000 population in 2021, below WHO’s recommended level (5 beds per 1,000 population). This supply-demand imbalance implies significant headroom for the expansion of private healthcare in Vietnam, supported by government policies such as Decision No.20/NQ-TW 2017[2], which sets the target for private hospital beds to account for 10% and 15% of the total number of hospital beds in 2025 and 2030, respectively. As a result, private hospitals and clinics will continue to generate significant interest, especially as patient volume is recovering to pre-pandemic level, while surgeries, complex procedures, and other high-value medical services have been reintroduced.

Notable trends

Pharmaceuticals – Favorable market conditions propelling strategic M&A partnerships

With no foreign ownership limit for pharmaceutical manufacturing, many local manufacturers have formed partnerships with foreign investors, with examples such as Taisho-DHG, Aska-Hataphar, SK-Imexpharm, and Daewoong-Traphaco. Per Decree No. 54/2017/ND-CP[3], foreign-invested entities cannot directly participate in pharmaceutical distribution in Vietnam, while still being able to distribute their locally produced products. This regulation makes investments in local manufacturers the most efficient way for foreign players to gain exposure to Vietnam’s pharmaceutical market, which is projected to reach US$16.1bn by 2026 per BMI Research[4].

Going forward, as a defensive sector, pharmaceuticals will receive strong interest amidst current global macroeconomic turbulence. The industry is set to benefit from the government’s strategy to promote domestic manufacturing, which aims to increase the share of locally produced pharmaceuticals to 80%[5], in a market historically dominated by imports. To boost competitiveness, local manufacturers will find M&A with foreign strategic investors as a viable strategic option, enabling them to meet global standards through transfers of technology, corporate governance, and management expertise. Meanwhile, investors are targeting manufacturers in Vietnam to capture local market potential and export opportunities through contract manufacturing partnerships.

Others – Emerging verticals with headroom for growth


The decrease in direct interaction due to the pandemic has brought healthtech into the spotlight, given increased demand for virtual healthcare services. Remote medical examinations and digitalization of medical records have been among the key focuses of the Vietnamese government. Meanwhile, in the private sector, healthtech startups serving various verticals of the market such as telehealth (JioHealth, Med247, eDoctor), third party administration (Insmart, South Asia Services), and e-pharmacy (Medici, POC Pharma) have recently successfully raised funding from foreign investors, highlighting the prospect of the nascent healthtech segment in Vietnam. However, healthtech is still trailing other tech-related sectors such as payment or e-commerce in investments and development progress, and there is still ample room for investors to participate in the value creation process.


The diagnostics market in Vietnam is still highly fragmented, with most players in the market being mom-and-pop labs with limited scale, low volume, and outdated technology. Thus, companies that can create scalable, modern, and tech-enabled networks of diagnostic services to capture market share will appeal to investors as good anchor assets for the creation of pathology platforms, similar to what happened in regional markets such as India and China. In addition to clinical diagnostics, genetic testing has also appeared on investors’ radar, with companies such as Genetica and Gene Solutions having completed their early funding rounds and Gentis being acquired by Eurofins.   

Medical equipment

There are still few local manufacturers that meet international standards – more than 90 percent of medical equipment in Vietnam is imported, according to the Ministry of Health[6]. Nevertheless, the recent US$30m investment in 2022 by Eastbridge Partners in USM Healthcare, a local stent manufacturer, signifies that high quality assets in this space will still generate good traction. This sector will be an interesting one to watch, especially in the medical consumables segment (e.g., stents, sutures, etc.), which is more prevalent among local assets.

Looking ahead

From our recent interaction, healthcare regularly features among the key focuses of financial sponsors. Given favorable sector trends, financial sponsors are going to capitalize on and exit their investments, while also remaining as active investors due to accumulated dry powder and pent-up dealmaking demand after the pandemic. On the other hand, strategic investors will continue to closely monitor suitable opportunities to invest in synergistic assets in Vietnam. Investors with existing presence in Vietnam or in markets with similar levels of development will have an advantage through their deep understanding of market intricacies and strong operational know-how, to quickly integrate with potential targets.

In conclusion, we remain confident in the availability of M&A opportunities in Vietnam’s healthcare market going forward, especially now that Covid-related impacts that created valuation gaps and diligence challenges should no longer remain as obstacles. We look forward to a busy period ahead in 2023 with our ongoing live deals and strong pipeline of opportunities in the sector.







Huong Trinh, Partner and Head of Ho Chi Minh City at BDA Partners, shares insights on Vietnam F&B sector in M&A on VIR.

Vietnam Investment Review

How do you see the trend of M&As in Vietnam’s F&B post-COVID? Do you see a slowdown in this area?

Post-Covid, we are still observing continuing interests from both strategic and financial investors, especially ones from Japan, Korea, and Southeast Asia for F&B companies in Vietnam. The total value of M&A transactions in Vietnam’s consumer sector reached US$1.2bn in 10M2022, an increase of nearly 40% yoy from US$871m in 10M2021. Meanwhile, it is worth noting that in recent months in 2H 2022, consumer confidence has been impacted by ongoing macro factors (e.g., surging inflation and interest rates). Nevertheless, going forward, we still expect a buoyant F&B market outlook, as Vietnam remains as one of the most attractive F&B markets in the region with robust market fundamentals and a strong socioeconomic backbone thanks to (i) a fast-growing market with 100 million consumers, propelled by robust economic growth and rising income, (ii) a young and dynamic population increasing propensity to spend, and (iii) rising demands for e-commerce and modern retail driven by rapid urbanization. These are the key factors driving M&A activities in the Vietnam’s F&B sector.

Filipino food company Jollibee Food Corporation is reportedly seeking to sell a minority stake in Vietnamese coffee chain Highlands Coffee. The sale could lead to an IPO launch for the coffee chain, which Jollibee has been considering for several years. What are the opportunities for foreign companies to conduct M&As in Vietnam’s F&B market? What are some major F&B deals in Vietnam in 2022?

We believe there remain many opportunities for foreign investors looking for potential targets for M&A of F&B companies in Vietnam, given the strong growth prospects. Strategic investors will be on the hunt for Vietnamese F&B companies to expand their product portfolio, manufacturing capacity and distribution network in the country. Such investments will also provide strategic investors quick access to a highly potential F&B market with 100 million consumers with rapidly growing disposable income. This attractive market outlook will also appeal to financial sponsors, especially ones with strong track record of operational expertise in the sector.

Additionally, in Vietnam, there is generally no restriction/limit on foreign ownership applicable to F&B companies. This opens various opportunities for foreign investors to penetrate Vietnam market via M&A, especially for those who prefer to seek controlling stakes in the target companies.

From our discussions with investors within our network, sub-segments in the F&B sector that we continue to see strong interests from foreign investors are food service, food ingredients and additives, and F&B retail. Vietnam F&B companies with (i) strong brand equity and awareness, (ii) extensive portfolio of staple products that are less directly affected by market fluctuations, (iii) nationwide distribution network, (iv) healthy financial performance, and (v) clearly defined business plans with attractive growth initiatives will present compelling investment opportunities for foreign investors.

Some remarkable F&B transactions in 2022 include:

Vietnam Dairy Products JSC (Vinamilk) and Kido Group JSC have just announced the suspension and dissolution of the joint venture Vibev. Could you comment on the dissolution of the F&B joint venture? What are challenges for F&B players to restructure their M&A strategies post-COVID?

The current regional and local macro situations may impact corporate considerations and decisions on business plans, including what should be the strategic focus for 2023 and onwards. These are also mentioned in Kido and Vinamilk’s statements regarding the dissolution of their JV. There are various aspects that F&B companies should carefully consider, so that their M&A activities (i) can be aligned with corporate strategies, and (ii) can add long-term synergistic value to the Company and stakeholders.

Some key challenges/considerations for F&B players regarding their M&A strategies include:

ChallengesMitigations and opportunities
For sellers 
How to align and balance the value from long-term M&A strategies with current business requirementsIn some cases, shareholders or companies may have to choose between long-term strategic value and immediate capital needs. Nevertheless, F&B companies should always carefully consider such synergistic values that an investor may contribute to the development and expansion of the business (other than capital), when it comes to selecting the right strategic partner for M&A. Those values can be global best practices in corporate governance, know-hows in operations, network relationships or product portfolio expansion, etc.
Business performance can be impacted by macro factors (e.g., higher inflation and interest rates, which may impact valuation)Valuation can be based on future performance or normalized current performance rather than current accounting performance. In such case, companies need to have a clear explanation for its performance during COVID period and a normalized level of performance. Companies with clearly defined business plans and well-established growth initiatives will be able to deliver more attractive growth stories and will be more likely to solicit better valuation/terms from investors. Companies should also keep in mind about the timing for M&A, so that investors may have sufficient time to understand and appreciate the business and growth potentials, before making an investment decision. Professional M&A sell-side advisors may help shareholders and the Company with fine-tuning the equity story and articulating growth prospects to potential investors to maximize value.
How to be well prepared to maximize value from M&A transactionsIt can be time-consuming to prepare for an M&A transaction. To fully appreciate the business, investors will need to review an extensive level of company’s information, including historical and forecast financials, and detailed business plan. As such, companies should be well prepared in terms of available information that can be shared with investors before going to market for M&A.
For buyers 
How to identify and select the right targets for acquisition, and how to integrate long-term growth directions with M&A strategies amidst recent market fluctuationsBoth strategic investors and financial sponsors should maintain a clear pipeline of potential targets in the wishlist and be prepared to have sufficient funding for prompt deployment when good opportunities become available (which usually involve strong competition).
Portfolio performance review and non-core business considerationsCompanies should constantly review performance of portfolio companies and identify under-performing or non-core businesses for further action. This is to ensure that M&A activities actually bring value to the group business, and that most (if not all) investments align with the company’s strategic directions. Divestment of under-performing or non-core may be considered.

Huong Trinh, Partner and Head of Ho Chi Minh City at BDA Partners, shares insights on the real estate and logistics market in M&A on DealStreetAsia.


“Accumulated dry powder and pent-up dealmaking lead to increased demand across all segments of the real estate market, with residential and industrial properties and projects attracting the most interest in 2022.”

“There is still ample headroom for development and investment opportunities in the segment, as Vietnam still needs to fill the demand of foreign corporations for the modernisation of industrial facilities to catch up with global standards and the introduction and integration of tech-enabled supply chain and logistics networks throughout the country,” said Trinh of BDA Partners.

In the short-term, M&A in real estate in Vietnam will be impacted by overall uncertainty in the macroeconomic environment and tightening of liquidity in the market, as the “easy money” period has come to a temporary halt, said Trinh of BDA Partners.

“Given tight liquidity available in the local banking and corporate bond system, we believe that there are opportunities for regional private credit funds, which have not been popular in Vietnam in the past, to penetrate the market,” she said.

Investors, Trinh went on, will require higher interest rates and more liquid assets to be used as collateral, reflecting the downgraded market outlook.

According to BDA Partners, foreign investors will continue to hunt for investments in both real estate projects and developers, driven by clear opportunities to capitalize on incumbent market potential in Vietnam’s fast-growing and transforming economy.

BDA Partners and OC&C Strategy Consultants jointly hosted the 2022 China Consumer and Retail Investment Forum in Shanghai. It was a great success. The Forum focused on Consumer and Retail investment opportunities for the post-COVID economy. Senior executives from leading multinational corporations, state-owned and private enterprises, as well as private equity firms, attended our inaugural event. The latest report 2022 China Consumer & Retail Investment Forum has captured all the insights of the Forum.

Key takeaways:

Download the full report

The FinTech sector in Southeast Asia (SEA) has been flourishing in recent years, with ever-increasing capital flowing into the region from global investors and market leaders. In our latest insight, we take a closer look at the key trends that make SEA an attractive FinTech market, the dynamics within key FinTech verticals, and how we expect financing activity to evolve.

Key takeaways:

State of the Tech markets

SEA FinTech landscape and exit thoughts

Download the full report

Although COVID-19 did not completely hamper M&A deal flow in Vietnam, travel restrictions and a strict lockdown in the second half of 2021 posed major challenges for buyers and sellers alike. With the gradual unwinding of COVID-related restrictions and the resumption of international flights in October 2021, M&A activity has accelerated. The economy has recovered quickly and the outlook for dealmaking is positive.

Top 10 M&A transactions in Vietnam (October 2021 – August 2022)

DateInvestorTargetDeal size (US$m)Stake
Oct-21SMBC Consumer FinanceFE Credit1,40049%
Jul-22Swire PacificCoca-Cola Indochina1,015100%
Dec-21TPG, Temasek, ADIAThe CrownX3504%
Nov-21SK HoldingsThe CrownX3455%
Feb-22AC EnergySuper Energy’s nine solar plants16549%
Oct-21UBS, Mirae, STICTiki136Undisclosed
Apr-22Hana Financial GroupBIDV Securities11835%
Aug-22MasanPhuc Long15534%
Apr-22Indorama VenturesNgoc Nghia Industry9498%

 Source: Mergermarket

Key drivers propelling post-pandemic deal flow

Vietnam’s economic recovery has proven appealing to investors – it was one of the few countries that recorded two consecutive years of GDP growth in 2020 and 2021 during the height of COVID. According to the General Statistics Office, Vietnam achieved 2.58% GDP growth in 2021[1], despite experiencing one of the strictest lockdowns in the world during the second half of that year. Looking ahead, the Asian Development Bank is forecasting that Vietnam’s economic growth will recover to 6.5% in 2022[2]. In fact, GDP growth in Q2 2022 was 7.7%, the highest quarterly growth in the last ten years.[3]

Pent-up dealmaking demand is a key driver. Both strategic investors and financial sponsors have a large amount of capital to invest and are keen to identify new opportunities or revive discussions that were on hold. Industry leaders are actively looking for acquisitions to consolidate market share within their verticals, taking advantage perhaps of competitors weakened by COVID and slower to rebound. In addition, many companies are looking to position themselves for recovery in the post-pandemic economy and need new capital injections for internal transformation and further growth in order to remain competitive.

The resumption of international travel is also significant. In-person due diligence and site visits have facilitated many deals that were previously put on hold, especially for asset-heavy industries such as industrials, logistics, and healthcare. Since October 2021, BDA has met with numerous foreign investors who have expressed a strong interest in Vietnam. After a two-year hiatus, BDA organised its annual networking event in Ho Chi Minh City in May 2022 with over 200 participants – mainly investors and corporate shareholders – and all appreciated the opportunity to reconnect in person and discuss the future.

Trends expected to persist post COVID

Domestic investors had an advantage over their foreign counterparts during COVID given their local presence, and this led to an increase in domestic deal flow and volume. Although COVID-related border restrictions have now been lifted, BDA has seen local conglomerates continuing their acquisition spree in a market that has historically been dominated by foreign buyers. For example, in addition to its investment in Phuc Long, Masan also acquired a 25% stake in Trusting Social, a company engaged with credit scoring based on social data, for US$65m in April 2022. This was another transaction in which BDA acted as the exclusive advisor to the target company. Nova Group has been on an acquisition spree, expanding its ecosystem with a focus on Consumer businesses, having acquired and taken over the operations of major F&B establishments such as Jumbo Seafood, Sushi Tei, Crystal Jade, and PhinDeli.

From a deal negotiation perspective, BDA has observed several points that have become particularly important during deal negotiations. With material adverse change (“MAC”) clauses, buyers and sellers now need to acknowledge the risk of a significant downturn in the business as a result of COVID. MAC provisions typically exclude market-wide macroeconomic impact, but since COVID has different effects on different industries, the negotiation of specific triggers in MAC clauses needs to be scrutinised. Earn-outs have become more common by bridging valuation gaps under scenarios of temporary uncertainty, while also enabling sellers to share in the upside of long-term growth. Warranty and indemnity (“W&I”) insurance, a rare option in Vietnam deals in the past, is also being used more frequently, as both buyers and sellers appreciate the benefit of a smoother and faster signing and closing process.

During the height of domestic lockdown and border restrictions in 2021, virtual interaction was the only option in most cases for M&A transactions in Vietnam. We expect that for non-key discussions, virtual meetings will continue to be a common option in the future. However, for other key parts of the transaction process such as site visits and due diligence, which were supported by on-the-ground advisors and virtual tours during COVID, and especially for negotiations, in-person participation will still be preferred going forward.

Global slowdown in M&A in 2022 and beyond

Global M&A in H1 2022 is down 21% by value and 17% by volume compared H1 2021[4], partly due to the cooldown in SPAC-related transactions. Inflationary pressure across the supply chain, geopolitical tensions, and a rising interest rate environment have also contributed to the volatility that could become a recurring theme in the M&A market over the next year or so.

Inasmuch as businesses in Vietnam are not immune to these factors, we still believe that 2022 will remain another busy year for Vietnam’s M&A market. Investors have not shown any reduced appetite in dealmaking in Vietnam, as evidenced in their interest in BDA’s ongoing mandates. We believe that there are a lot of high-quality assets that have proven resilient against turbulence brought about by COVID that are now well-positioned for robust growth, and we look forward to a busy period ahead with a long list of current live deals and ongoing opportunities.

Tailwinds for future growth in M&A in Vietnam include:

Most attractive sectors in Vietnam for M&A





Financial Services

Renewable Energy





In the last few years, several trends have gained traction in Japan’s M&A market. The trends had already begun to take hold before COVID, which did not slow their development. In our latest insight, we take a closer look at three of the most significant trends, which are interrelated and are driving one another: 1) divestments by Japanese companies; 2) the ever-increasing activity of PE funds; and 3) the growing influence of activist funds.

Key takeaways:

Japanese companies are increasingly willing to divest non-core subsidiaries and assets, driven by changing perceptions about corporate divestments

Divestments by Japanese companies are proving to be fruitful targets for PE funds, who are aggressively entering Japan market and raising record levels of capital

Another set of investment funds, activist investors, have stepped up their activity in Japan, embarking on campaigns against large companies to pressure them to increase corporate value

Source: Dealogic

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Download the full report in Japanese

As an increasing number of countries in Asia achieve an 80% vaccination rate, they are gradually removing COVID-19 social and border restrictions. BDA Partners is revisiting the fundamentals and attractiveness of the Asian healthcare services sector.

Healthcare services is the largest part of the healthcare industry in Asia. Its market size is expected to reach US$1.4tr by 2026[1], driven by a growing population, rising affluence, and a mounting disease burden.

Key takeaways:

In this piece, we examine post-COVID sector trends and M&A activities in SE Asia, Greater China, and India.

Sources: Mergermarket
Note: (2) Other healthcare subsectors include Medical Devices, Medical Equipment & Services, Biotechnology Research, Drug Development, Drug Manufacturing, Drug Supply, Handicap Aids and Basic Healthcare Supplies, etc.

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Contact BDA health team

Andrew Huntley, Managing Partner, Global Head of Healthcare, London / Ho Chi Minh City:

Anthony Siu, Partner, Co-Head of Shanghai:

Sanjay Singh, Managing Director, Head of India, Co-Head of Asia Healthcare:

Claire Zhen, Director, Shanghai:

Aditya Jaju, Vice President, Mumbai:

Yan Xia, Vice President, Singapore:

Zhang Simeng, Vice President, Shanghai:

[1] Fitch and Statista