Asia-Pacific Private Equity

Report 2025
Most markets showed signs of bouncing back,
but fund-raising remained in freefall.
Authors and acknowledgments
This report was prepared by:

Sebastien Lamy, a Bain & Company partner based in Tokyo and coleader of the firm’s Asia-Pacific
Private Equity practice;

Prabhav Kashyap Addepalli, a partner based in New Delhi and a member of Bain’s India Private
Equity practice; and

Elsa Sit, practice vice president with Bain’s Asia-Pacific Private Equity practice.

The authors wish to thank Kiki Yang, coleader of Bain’s Asia-Pacific Private Equity practice, for her overall
guidance; Andrew Tymms, Anthony Wicht, and Vikram Chandrashekhar for their perspectives on portfolio
growth imperative; Jisoo Ahn for his perspective on corporate carve-outs; Suvir Varma for his perspective
on secondary exits; Sungwon Yoon, Wonpyo Choi, Yeounghoon Yang, Hao Zhou, Usman Akhtar, Jim
Verbeeten, James Viles, Ben MacTiernan, and Sriwatsan Krishnan for their input on regional dynamics;
Mike McKay and Brenda Rainey for their input; Winnie Xie and Owain Palmer for their contributions;
Echo Han, Dhawal Pandey, Sanyam Sharma, Shilpi Bansal, Sanjukta Sen, Vedant Thapliyal, Nippun
Aggarwal, and the team from the Bain Capability Network (Ira Kaur, Vikas Sharma, Deepak Bhawani,
Shalini De, Siddhant Banerjee, Saloni Singh, and Kabir Singh Kochar) for their analytic support and
research assistance; and Gail Edmondson for her editorial support.

We are grateful to Preqin and Asia Venture Capital Journal (AVCJ) for the valuable data they provided and
for their responsiveness.

This work is based on secondary market research, analysis of financial information available or provided to Bain & Company and a range of
interviews with industry participants. Bain & Company has not independently verified any such information provided or available to Bain
and makes no representation or warranty, express or implied, that such information is accurate or complete. Projected market and financial
information, analyses and conclusions contained herein are based on the information described above and on Bain & Company’s judgment,
and should not be construed as definitive forecasts or guarantees of future performance or results. The information and analysis herein does
not constitute advice of any kind, is not intended to be used for investment purposes, and neither Bain & Company nor any of its subsidiaries
or their respective officers, directors, shareholders, employees or agents accept any responsibility or liability with respect to the use of
or reliance on any information or analysis contained in this document. This work is copyright Bain & Company and may not be published,
transmitted, broadcast, copied, reproduced or reprinted in whole or in part without the explicit written permission of Bain & Company.

Copyright © 2025 Bain & Company, Inc. All rights reserved.

 Asia-Pacific Private Equity Report 2025

Contents

Asia-Pacific Private Equity: A hesitant recovery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

What happened in 2024? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Deals: A cautious comeback . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Greater sector diversity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Competition favors the strong . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Multiples rebound . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Exits: Diverse trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Fund-raising: A 10-year low . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Returns remain challenging . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

The value creation imperative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Path to value creation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Balancing growth and strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

PE-backed carve-outs are plentiful,

but it’s harder to find winners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Carve-out appeal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

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 Asia-Pacific Private Equity Report 2025

Asia-Pacific Private Equity: A hesitant recovery

At a Glance

` Asia-Pacific deal value increased 11% in 2024, and exit value rose in every country except China,
but fund-raising declined sharply.

` India was the region’s star performer in 2024—the only country with double-digit growth in both
deal value and count.

` Global private equity funds are expanding their portfolio management teams in the Asia-Pacific
region to focus on value creation.

` Carve-outs are on the rise, but it’s harder to deliver strong returns; leading GPs rely on solid
value creation plans to turn carve-outs into strong performers.

For private equity investors in the Asia-Pacific region, 2024 brought glimmers of recovery. Investment rose
moderately in most countries, reversing two years of precipitous declines, while an 11% rebound in deal
value for the region gave fund managers a jolt of optimism (see Figure 1). Challenges remain, including
economic uncertainty and geopolitical tensions, but improving macroeconomic conditions boosted
investor sentiment.

Dealmaking activity in Asia-Pacific countries diverged sharply in 2024, reflecting changing dynamics in the
region’s economies. India was the region’s best performer in 2024—the only country with double-digit growth
in both deal value and count. As recently as 2020, China represented more than half of all Asia-Pacific
deal value, but that share fell to 27% in 2024. In recent years, general partners (GPs) and limited partners
(LPs) have channeled a greater share of investment dollars to India and Japan, and that trend continued
in 2024.

Uncertain market conditions continued to fuel a surge in buyouts as GPs sought greater control over
portfolio companies to manage risk and ensure value creation. Fund managers balanced their investments
across different business sectors to diversify their exposure, seeking deals with strong business
fundamentals, a sound exit strategy, and attractive entry valuation. Technology and cloud services, which
have generated exponential growth but variable success rates in the past, continued to lose share. Sectors
that are more resilient and lower risk, including communications and media, services, and financial
services, gained share.

Intense competition for fewer attractive deals continued to squeeze weaker funds out of the market, and
the number of active investors in the region declined significantly. The top 20 funds’ contribution to total
deal value remained above 40%.

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 Asia-Pacific Private Equity Report 2025

Figure 1: Asia-Pacific deal value increased slightly, exits were flat, and fund-raising
plunged further in 2024

Asia-Pacific private Asia-Pacific private Asia-Pacific-focused

equity investments ($B) equity exits ($B) closed funds, by close
year ($B)

Deal count Exit count Number of funds closed

375
3,000 2,000 179
218
109
208 148 1,000
$119B
$174B 158 208
2,000 95

176 140 1,000 74

107
94 106
1,000 $92B

0 0 0
2019 24 2019 24 2019 24

Notes: Excludes real estate and deals/exits with a value under $10 million; fund-raising data excludes
RMB-denominated funds
Sources: AVCJ; Preqin; Bain analysis

The number and value of exits in the Asia-Pacific market were flat, but a sharp drop in Greater China’s exit
value masked gains in other countries. Most fund managers across the region said the exit environment
improved in 2024. Secondary sales became the largest exit type, as well as an attractive channel for GPs
to accelerate distributions and for LPs to improve liquidity. India became the region’s biggest exit market,
powered by a large number of initial public offering (IPO) exits. The value of Asia-Pacific IPO exits fell to
only 31% of total exit value in 2024, compared with the previous five-year average of 48%. The main
reason for that decline was the sluggish public market performance in China and other markets.

The pressure on fund managers to make exits and increase distributions to LPs rose significantly in 2024.
Among buyouts in the 2017–19 vintage valued at $100 million or more, only 26% had exited by the fifth year
of ownership, compared with 43% for those in the 2011–13 vintage. By year-end 2024, the 2011–19 vintage
group included more than 200 portfolio companies held more than four years, a powerful signal that GPs
should be seeking an exit.

Achieving top returns has become increasingly challenging. The gap between top-performing funds and
bottom-quartile funds is widening for the same vintage fund. The top-quartile funds from vintage 2017
have delivered an internal rate of return (IRR) of more than 25%, while the bottom-quartile funds are only
producing a high single-digit IRR for the same period. Despite the growing gap in returns, fund managers
expect returns to rebound in the next three to five years, according to Bain’s 2024 Asia-Pacific Private
Equity survey.

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 Asia-Pacific Private Equity Report 2025

The fund-raising environment remained gloomy in 2024, and dry powder declined from a record level in
2023, reflecting challenging fund-raising conditions. Fund-raising at Asia-Pacific-focused funds fell 22% to
a 10-year low (excluding RMB funds), mirroring the 23% decline in global fund-raising. Fund managers
cited the challenge of too many groups competing for a shrinking pool of funds. As LPs gravitated to
funds with a strong track record, large funds continued to get larger. CVC Capital Partners and TPG
closed their biggest-ever Asia-Pacific-focused funds in 2024.

Net distribution was a bright spot for Asia-Pacific fund managers in 2024, turning positive for the first
time since 2021. Our survey showed GPs were more optimistic about future returns, convinced that top-
line growth and cost improvement will help power successful exits and returns.

Net distribution was a bright spot for Asia-Pacific fund

managers in 2024, turning positive for the first time since 2021.

Fund managers continue to see top-line growth as the key factor behind strong returns, although nearly
50% say they fail to meet growth expectations in more than half the deals they close, according to our
survey. To address that challenge, GPs are strengthening their portfolio management capabilities to
support value creation and successful exits. Those that succeed have clear priorities, achieve strong
execution, and ensure alignment with portfolio company management.

While fund managers are redoubling their focus on portfolio value creation, they continue to rank the
search for attractive investment opportunities as a top priority. Corporate carve-outs rose in 2024,
throwing a spotlight on carve-out returns. While carve-outs used to routinely outperform the average
private equity buyout, increased competition and elevated multiples have made it harder to deliver strong
returns on these complex transactions. The firms doing it right use an iron-clad value creation plan to
transform carve-outs into strong performers.

4
What happened in 2024?

Deals: A cautious comeback

Private equity investors in the Asia-Pacific region reversed a two-year dealmaking slump in 2024 despite
ongoing turbulence in global markets. Deal value rose 11%, while deal count declined 9%. It was not the
robust recovery GPs would have wished for, and the rebound was uneven across the region. However,
the flush of dealmaking helped boost investor sentiment, especially in India, where the surge in activity
was strong.

Wary of ongoing macroeconomic and market uncertainty, investors sought greater control to manage risks
and ensure a clear path to increasing value. The share of buyout deals grew to more than 50%, while the
percentage of growth deals shrank (see Figure 2). Notably, the share of buyout deals rose in traditionally
growth deal markets, including India, Southeast Asia, and Greater China. Lower interest rates across most
of the region also fueled more buyouts. Overall, Asia-Pacific deals were larger. Average deal size in the
region rose to $133 million, up 22% over 2023 and 12% higher than the previous five-year average. The
number of megadeals, or deals valued at $1 billion or more, increased by 50% compared with 2023, lifting
average deal size.

The recovery in dealmaking varied widely across Asia-Pacific countries. Greater China produced higher deal
value than any other country in the region, but deal value rose only modestly, and its share of the market
continued to drop. India was the region’s No. 1 performer in 2024—the only country with double-digit
growth in both deal value and count. Australia–New Zealand’s deal value more than doubled, fueled by the
$16 billion AirTrunk deal. Japan’s deal count was unchanged, but deal value was down sharply vs. the
previous year, which included multiple megadeals. In South Korea and Southeast Asia, dealmaking revived
(see Figures 3 and 4).

Looking at a longer time horizon, India and Japan were the only two markets that maintained a deal count
in 2024 similar to the previous five-year average. Although India faces macroeconomic challenges, including
inflation and consumption slowdown, it remains one of the fastest-growing countries in the region based
on GDP, and investors are drawn to its strong growth fundamentals. In Japan, strong historical returns and
expanding opportunities to take public companies private have encouraged investors and private equity
funds to put more money to work.

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 Asia-Pacific Private Equity Report 2025

Figure 2: The share of buyout deals rose above 50%, as investors opted for more
control and less risk

Share of Asia-Pacific investment value, by deal type

100% $157B 226 176

Other
PIPE financing
80
Start-up/early-stage
Growth
60

40

Buyouts
20

0
2014–18 2019–23 2024
average average
Share of buyout
40% 35% 53%
deal value

Notes: Excludes real estate and deals with a value under $10 million; PIPE financing is private investment in public
equity; start-up/early-stage investments use financing for product development and initial marketing; the company
may be in the process of being organized or may have been in business for a short time, but hasn’t sold its product
commercially; growth includes expansion, growth, mezzanine, and pre-IPO capital deals
Sources: AVCJ; Bain analysis

Figure 3: All countries increased their value share against the previous five-year
average except for Greater China

Share of Asia-Pacific private equity deal value, by region

100% $157B 226 176

Southeast Asia

South Korea
80
Japan

60
Australia–
New Zealand

40
India

20
Greater China

0
2014–18 average 2019–23 average 2024

Notes: Greater China includes China, Hong Kong, and Taiwan; excludes real estate and deals with a value under
$10 million
Sources: AVCJ; Bain analysis

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 Asia-Pacific Private Equity Report 2025

Figure 4: India was the only country to achieve double-digit growth in deal value
and deal count in 2024

Asia-Pacific private equity deal value, by market ($B)

$100B
$88B

80 800

60 600
44 47 46 38 43
40 400
30 33 33
24 22 21
20 17 20 15 16 200
14 10

0 0
Greater India Australia– Japan South Korea Southeast
China New Zealand Asia

2019–23 average 2023 2024 Deal count

Note: Excludes real estate and deals with a value under $10 million
Sources: AVCJ; Bain analysis

Fund manager attitudes mirrored the divergent levels of dealmaking activity across the region. Investors
in India, Japan, and Australia–New Zealand were the most optimistic about the coming year. More than
70% of GPs in India thought 2024 was a better year. By contrast, almost 60% of Greater China investors
thought it was worse than 2023.

Seven of the largest global fund managers who have invested in the Asia-Pacific private equity market for
more than 25 years are rethinking their geographical mix and moving their focus away from China toward
other markets. In 2024, these GPs closed almost twice as many deals in Japan and India as they averaged
from 2014 to 2018 (see Figure 5). Their investments in Greater China, by contrast, declined to less than
one-third of the 2014–18 average.

Similarly, LPs recognize the attractiveness of India and Japan and endorse the strategic shift to those
markets. In Preqin’s 2024 global LP survey, Japan ranked No. 4 globally for the best private equity
investment opportunities in developed markets (after the US, Western Europe, and the UK)—and it
ranked No. 1 in the Asia-Pacific region. Among emerging markets, India ranked No. 1 globally.

Looking forward, major global private equity funds plan to double down in India and Japan and deploy
more capital in those countries. Carlyle, for instance, aims to allocate about 30% to 35% of its new
pan-Asia fund to India, making it the firm’s largest market in Asia. Bain Capital plans to invest 20% of
its Asia fund in India and is on track to invest up to $10 billion in India over the next three to five years.

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 Asia-Pacific Private Equity Report 2025

Figure 5: Leading global fund managers are doing more deals in India and Japan

Number of deals (over $100 million)

Australia–
Southeast New South Greater
India Japan Asia Zealand Korea China

2014–18
average 8 4 7 5 3 11

2024 15 7 7 5 4 3

Notes: Excludes real estate and deals with a value under $100 million; peer funds include seven global multi-asset
fund managers investing in the Asia-Pacific region for more than 25 years
Sources: AVCJ; Bain analysis

Greater sector diversity

Technology is still the dominant sector in private equity investing across the Asia-Pacific region, with the
highest share of deal value and count. But GPs sought greater industry balance in their portfolios in 2024,
eager to diversify their exposure in an uncertain environment. Technology’s share of deal value shrank
to 25%, down from 50% in 2018 (see Figure 6). At the same time, investment in non-technology-related
industries, such as communications and financial services, rose.

The share of the top three sectors in 2024 decreased to 60%, down from 73% in 2021. For the first time
since 2018, technology was edged out as the top PE investment sector in South Korea, as investments in
energy and natural resources overtook tech.

Communications and media, services, and financial services showed the highest growth rates in deal
value over the previous year. The surge in communications investment was powered by several large
deals in data centers, including the $16 billion AirTrunk deal. The financial services sector was buoyed by
investments in India, including several sizable deals in property loan and personal loan businesses.

Investors said they are looking for deals with solid business fundamentals (39%); a clear exit strategy
(37%); and an attractive entry multiple (32%). Solid business fundamentals ranked No. 1 in 2024, up from
No. 3 in the previous year.

Competition favors the strong

The challenging private equity environment in the Asia-Pacific region is steadily squeezing out the
bottom-ranked investors. In 2024, the number of active investors declined 10% to 2,412—the second drop
in two years (see Figure 7). Smaller funds are also struggling.

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 Asia-Pacific Private Equity Report 2025

Figure 6: Investments were more balanced by industry, but technology

remained the largest sector

Percentage of Asia-Pacific private equity deal value, by sector

100%
Other
Higher education
and training
80
Consumer products
Retail
60 Financial services
Services
Energy and
40 natural resources
Healthcare
Advanced manufacturing
20 and services
Communications and media
Technology and
0 cloud services
2019 20 21 22 23 24

Notes: Other includes deals tagged under government/public sector, private equity, conglomerate, other industry,
and no industry; excludes real estate and deals with a value under $10 million
Sources: AVCJ; Bain analysis

Figure 7: The number of active investors declined 10%; the top 20 funds’ share
of deal value remained over 40%

Number of active firms investing in the Asia-Pacific private

equity market

3,483 3,510 CAGR Change

–10% 2019–22 2022–24

2,694
2,394 2,412
1,857 1,974
1,453 1,564
21% −17%

2016 17 18 19 20 21 22 23 24

Top 20
funds’ 35% 38% 33% 37% 32% 30% 31% 43% 41%
share

Note: Excludes real estate and deals with a value under $10 million
Sources: AVCJ; Bain analysis

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 Asia-Pacific Private Equity Report 2025

By contrast, the top 20 investors’ share of total deal value remained high at 41%. Global fund managers
and regional fund managers increased their share of deal value significantly in 2024 (see Figure 8), and
Asia-Pacific investors view these two groups as their biggest competitive threat.

While most investors in the region worried about macroeconomic trends and exit conditions,
Japanese fund managers’ top concern was greater competition from other fund managers (69%). The
number of active investors in Japan rose 14% to more than 380 in 2024, bucking a regional trend of
shrinking competition.

Underscoring Japan’s attractive market dynamics, several major global investment firms, including
Warburg Pincus and Ares Management, are setting up offices in the country.

India’s strong market dynamics are also attracting global PE funds to open local offices. The number of
active investors in India rose 29% in 2024, helping fuel an increase in deal count and deal value.

Multiples rebound

Deal multiples—the ratio of enterprise value to EBIDTA—edged up after a sharp fall in 2023. The median
deal multiple rose to 12.8 from 10.3 a year earlier (see Figure 9). Factors contributing to the rebound
include rising valuations of comparable companies listed on public markets across the region and public
market recoveries or rallies. Competition also boosted multiples as fund managers chased a limited
number of attractive deals. GPs cited high entry valuations as their second highest concern, after

Figure 8: Global and regional GPs’ share of deal value rebounded

Percentage of Asia-Pacific deals involving specific investor groups,

weighted by value
2019 2020 2021 2022 2023 2024

75%

50

25

0
Global Regional Domestic Government Institutional Corporate
GPs GPs GPs affiliates investors investors

Notes: The sum of percentages for each year is greater than 100% because many deals have more than one
investor group; excludes real estate and deals with a value under $10 million
Sources: AVCJ; Bain analysis

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 Asia-Pacific Private Equity Report 2025

Figure 9: Asia-Pacific deal multiples rebounded

Median EV/EBITDA multiple on Asia-Pacific private equity-backed

M&A transactions

14.5 14.8
13.7
13.1 12.8
11.7 11.7
11.3x
10.2 10.3

2015 16 17 18 19 20 21 22 23 24

Notes: EV is enterprise value; equity contribution includes contributed equity and rollover equity; based on pro
forma trailing EBITDA; excludes multiples less than 1 or greater than 100
Source: S&P Capital IQ as of January 22, 2025

challenging exit conditions, according to our survey. And they are likely to remain a key issue. Over 70%
of respondents expect valuations in the next two years to remain at a similar level or rise.

Exits: Diverse trends

Asia-Pacific investors ranked the exit environment as their top challenge in 2024, up from No. 3 a year
earlier. Total exit value and count for the region were roughly flat, ending two years of precipitous decline.
But a sharp drop in Greater China’s exit value masked gains in other countries. Overall, Asia-Pacific exit
value dipped 1% compared with 2023. Still, manager sentiment on exits improved in 2024, reflecting
diverse trends across the region. More than 60% of GPs indicated the exit environment was similar to
2023 or better (vs. only 21% in 2023). That said, investor views differed widely from country to country.
Around 60% of GPs in Korea and Greater China said 2024 was a more challenging year for exits, while
50% of GPs in India rated the year as more favorable.

India was the region’s largest exit market in 2024 in terms of value and count. India’s IPO exit value was
up 78% year on year (see Figures 10 and 11), powered by a vibrant stock market. The BSE Sensex stock
market index of 30 prominent companies on the Bombay Stock Exchange rose more than 8% in 2024.
Trading volume on the National Stock Exchange of India Limited (NSE), a leading exchange in Mumbai,
and the Bombay Stock Exchange increased by 40% and 30%, respectively. The number of IPO listings on
the NSE jumped 45% to a record 268.

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 Asia-Pacific Private Equity Report 2025

Figure 10: India’s share of exit value rose sharply; Greater China’s share dropped
below 20%

Share of Asia-Pacific private equity exit value, by region

100%
$129B 128 106
Southeast Asia
South Korea
80
Japan

60 Greater China

Australia–
40
New Zealand

20
India

0
2014–18 average 2019–23 average 2024

Note: Excludes real estate and exits with a value under $10 million
Sources: AVCJ; Bain analysis

Figure 11: Exit value rose in most Asia-Pacific markets; Greater China was the
only country with a drop in exit value and count

Asia-Pacific private equity exit value, by country ($B)

2019–23 average 2023 2024 Exit count

Exit count by country

$80B 300
63

60
49 200

40
$23B 35
27 100
22
20 17
15 8 11 14 13 13
8 8 6 4 5
0 0
India Australia– Greater Japan South Korea Southeast
New Zealand China Asia

Note: Excludes real estate and exits with a value under $10 million
Sources: AVCJ; Bain analysis

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 Asia-Pacific Private Equity Report 2025

Australia–New Zealand ranked No. 2 in exit value for the region, buoyed by the $16 billion AirTrunk exit.
However, exit count fell by 5% vs. 2023.

Greater China posted the biggest decline in exit value and count. Exit value plunged by around 65% year
on year, and exit count decreased more than 40%. The country’s IPO exit value was down 70%, and
secondary exits nearly dried up, with only one secondary sale for the year.

South Korea and Southeast Asia achieved double-digit growth in both exit count and value year on year.
South Korea’s surge was propelled by two secondary megaexits, or exits with a value of $1 billion or more,
with Ecorbit ($2 billion) and Geo-Young ($1.4 billion). Southeast Asia had no IPOs in 2024, but its exit value
was boosted by the PropertyGuru exit, which was secondary as well.

Japan produced the greatest number of megaexits, including Accordia Golf, Alinamin Pharmaceutical,
and Kokusai Electric.

Secondary transactions were the region’s largest exit channel in terms of value, bolstered by the $16
billion AirTrunk deal. As GPs look for ways to accelerate distributions and LPs insist on liquidity, the
region’s secondary market is likely to become even more active.

IPOs were the only channel where Asia-Pacific exit value and count declined (see Figure 12). A key factor
in the decline was Greater China’s weak stock market performance compared with other Asia-Pacific
countries. In 2023, Greater China accounted for 75% of the region’s IPO value. In 2024, that number fell

Figure 12: Secondary sales were the largest exit channel; the initial public offering
channel shrank significantly

Share of Asia-Pacific private equity exit value, by channel

100%
$129B 128 106

IPO/open
80 market sale

60
Trade

40

20 Secondary

0
2014–18 average 2019–23 average 2024

Note: Excludes real estate and exits with a value under $10 million
Sources: AVCJ; Bain analysis

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 Asia-Pacific Private Equity Report 2025

Figure 13: Fund managers are under pressure to make successful exits

Percentage of Asia-Pacific buyout deals over $100 million exited

by end of fifth year of ownership
43%

31%
26%

2011–13 2014–16 2017–19

Deal vintages

Notes: Only includes buyout deals with single investor in Asia-Pacific, a deal size greater than $100 million, and a
completion date of 2011 or later; excludes real estate
Sources: AVCJ; Bain analysis

to 32%. Nearly 30% of fund managers across the region said the main impediment to successful exits was
soft IPO markets. The region produced only two IPO megaexits in 2024: Kokusai Electric open market
sale ($2 billion) and Swiggy ($1.4 billion), many fewer than in previous years.

Following three tough years for exits, GPs face significant pressure to sell companies in their aging
portfolios (see Figure 13). Only 35% of Asia-Pacific fund managers achieved or exceeded the number of
planned exits in 2024. More than 50% of GPs surveyed said they are increasing their focus on portfolio
management and exits to differentiate themselves from the competition.

Among buyout deals with single investors from vintages 2017–19 valued at $100 million or more, only 26%
were sold within five years of ownership, compared with 43% for vintages 2011–13. And by the end of 2024,
more than 200 portfolio companies in this group of larger deals from vintages 2011–19 had surpassed the
fourth year of ownership.

To address the challenges of aging Asia-Pacific portfolios, some global fund managers are expanding
their portfolio operations teams. A Bain study of major global fund managers with a strong presence in
the Asia-Pacific market showed the group added about 10% to portfolio team headcount in the region in
2024. For example, in April 2024, Carlyle appointed Masahiko Fukasawa to the newly created role of
Head of Global Portfolio Solutions, Japan, to expand the team and strengthen Carlyle’s portfolio
operational value creation efforts in Japan and the Asia-Pacific region.

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 Asia-Pacific Private Equity Report 2025

Fund-raising: A 10-year low

For the third year in a row, investors raising new funds (excluding RMB funds) continued to face
significant challenges. The value of Asia-Pacific-focused funds raised in 2024 slumped to a 10-year low
of $74 billion, down more than 20% year on year, and 43% lower than the previous five-year average.

Global fund-raising in 2024 was down 23%, excluding RMB funds, and Asia-Pacific’s share of global
fund-raising was a low 7%, down from 13% in 2021 (see Figure 14).

The final size of Asia-Pacific closed funds was 4.3% below target size on average, and it took fund managers
longer to close new funds (see Figure 15). The average time required to close a fund increased to 24 months.

The key impediment to fund-raising was the shortfall in exits. LPs need to see improved distributions to
paid-in capital (DPI) through more exits to justify new commitments. In addition, GPs cited several
reasons for the difficulty in closing funds, including strong competition for funding, LPs’ reduced
allocations to some Asia-Pacific countries, such as Greater China, and LPs’ preference for funds with a
strong track record.

GPs ranked competition as the most challenging factor in all countries except Greater China and Southeast
Asia. One reason: Asia-Pacific’s strong market performance in the last decade attracted a lot of investors
who are now competing for a shrinking pie. More than three-quarters of GPs in Greater China cited
reduced LP allocations in the region as a reason for the difficulty in closing funds.

Figure 14: Global fund-raising declined 23%; the share of Asia-Pacific-focused

funds remained low at 7%

Global private capital closed funds, by final size and

year of final close ($B)
(–23%)

1,405 1,385 1,337

1,128
$1,059B 1,024

Rest of
the world
Primarily
focused on
Asia-Pacific
2019 20 21 22 23 24

Share of
Asia-Pacific- 11% 10% 13% 11% 7% 7%
focused funds

Notes: Includes closed-ended and commingled funds only; excludes real estate and RMB-denominated funds; data
includes funds with final close and represents the year in which they held their final close
Sources: Preqin; Bain analysis

15
 Asia-Pacific Private Equity Report 2025

Figure 15: Fund-raising was difficult: Fewer funds closed, and the size of closed
funds fell short of targets, but the average fund size grew
Number of Asia-Pacific- Average fund size of Final size vs. target size
focused funds closed closed Asia-Pacific- for closed Asia-Pacific-
focused funds focused funds
First-time fund
Experienced fund
8.7%
(+28%)
1,179
$160M
166 4.9%
911 163 5.3%
822 130 174
742 698 152 4.6%
136 132 136
147 107
422
–4.3%
57

–1.0%
2019 24 2019 24

Percentage of funds
of $1 billion or more
in total fund-raising 2019 24

2019–23 average: 41%

2024: 63%

Notes: Funds closed include those focused only on the Asia-Pacific region; excludes real estate and RMB-
denominated funds
Sources: Preqin; Bain analysis

Despite the downturn in 2024, investor sentiment for the next 12 months improved over the previous year.
Only 45% of respondents judged the 2024 fund-raising environment as worse or much worse than the
previous year. That number was 86% in 2023. Nearly a quarter of GPs believe fund-raising in 2025 will be
somewhat easier, compared with only 11% in 2023.

Investors continued to migrate to quality funds with proven performance. The average size for closed
funds was $174 million, up 28% year on year and 17% higher than the previous five-year average. Funds
with a value of $1 billion or more accounted for 63% of total funds raised, up from the previous five-year
average of 41%. The count share of these large funds was only 4%.

LPs favored global and regional funds with stronger track records. Examples include CVC’s Asia VI fund,
which closed at $6.8 billion, TPG’s Asia VIII fund at $5.3 billion, and PAG’s Asia IV fund at $4 billion. The
CVC and TPG funds rank as the largest each has raised to date. The number of first-time funds declined
sharply, and those that closed were smaller in size. The count of first-time funds dropped by more than
45% year on year, while the average size dropped roughly 40%. By comparison, experienced funds were
37% larger in value on average.

16
 Asia-Pacific Private Equity Report 2025

Investors continued to shift capital raised to pan-Asia funds to help reduce their exposure to market-
specific risks. The share of pan-Asia funds in 2024 was nearly 60%, up from 36% in 2019 (see Figure 16).
At the same time, India- and Japan-focused funds increased their share significantly, from 7% to 10% and
7% to 15%, respectively, vs. the 2019 level.

Dry powder, or total unspent private equity capital, declined for the Asia-Pacific region from its record
level in 2023. A difficult fund-raising environment contributed to the dip. The estimated level at mid-year
2024 was $260 billion, excluding RMB-denominated funds (see Figure 17).

Returns remain challenging

The region’s fund managers have mixed expectations on future returns, but our survey highlighted a
noticeable optimism, with 87% of respondents stating they believe returns will not decrease in the coming
three to five years, up from 61% in 2023 (see Figure 18). The most important factors affecting returns on
deals exited were top-line growth (53%) and cost improvement (41%). And GPs believe these factors will
continue to influence deal success in the next five years.

However, achieving fund managers’ desired returns remains challenging. Just over half of the fund
managers surveyed claimed to have achieved top-line growth targets for more than 50% of exits, and only

Figure 16: The share of pan-Asia-Pacific funds and India- and Japan-focused
funds rose sharply compared with the pre-pandemic period

Asia-Pacific-focused private equity capital raised,

by final year of close ($B)

179

148

$119B Other Asia-Pacific

109 Southeast Asia
95
Australia–New Zealand
74 Greater China
South Korea
India
Japan
Pan-Asia-Pacific
2019 20 21 22 23 24
Share of pan-Asia-Pacific-
36% 32% 43% 40% 41% 57%
focused funds
Share of Japan-focused
7% 16% 7% 10% 15% 15%
funds
Share of India-focused
7% 9% 7% 8% 10% 10%
funds

Note: Excludes real estate and RMB-denominated funds

Sources: Preqin; Bain analysis

17
 Asia-Pacific Private Equity Report 2025

Figure 17: Dry powder declined in 2024, but GPs remain under pressure to
deploy capital

Unspent private equity capital at Asia-Pacific-focused funds

at year-end ($B)
CAGR
2020–24
296 303
280 1%
260
248 Other PE −1%
230
212 Fund of funds –5%
$188B
Infrastructure 5%
Growth 3%
Venture 7%

Buyout −3%

2017 18 19 20 21 22 23 24
(as of June)

Note: Excludes real estate and RMB-denominated funds

Sources: Preqin; Bain analysis

Figure 18: Despite ongoing challenges, fund managers are more optimistic
about 2025

Did you achieve target top-line How are your net returns
and margin expansion over the likely to evolve in the next
holding period? 3 to 5 years?
Percentage of PE fund respondents Percentage of PE fund respondents

91 91 93 96
100% 100%
11% In most situations
19% (>80% of total exits)
80 In many situations 80 35% 39% Increase
29% (50%–80%
32% of total exits)
60 60
In some situations
26%
(25%–50%
40 39% of total exits) 40
47% Stay the same
36% Not that often
(5%–25% of
20 total exits) 20 39%
10% 19% Very rarely 13% Decrease
0 2% 2% (0–5% of total exits) 0
Top-line Margin 2023 2024
growth expansion
targets targets
achieved achieved

Note: Respondents calculated as the weighted aggregate of responses across regions

Source: Bain & Company Asia-Pacific Private Equity Report surveys, 2025 (n=130) and 2024 (n=130)

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 Asia-Pacific Private Equity Report 2025

Figure 19: Asia-Pacific returns remain steady across vintages, with the gap
between top and bottom quartiles widening

Net internal rate of return for Asia-Pacific-focused funds, by vintage

30%

Top-quartile
funds
20

Median funds

10
Third-quartile
funds

0
2009 10 11 12 13 14 15 16 17 18
Vintage year

Gap between top and

third-quartile funds 15 13 11 7 9 15 10 11 19 16
(percentage points)

Notes: Includes latest performance data available on Preqin; vintage year refers to year of initial investment;
excludes real estate, infrastructure, and funds with no value or no available IRR; the chart for net IRR by vintage is
as of January 2025
Source: Preqin

40% achieved margin expansion targets in more than 50% of the portfolio companies sold in the last two
to three years.

For vintages in which returns are predominantly realized (2016–18), the top quartile funds have delivered
internal rates of return (IRR) ranging from 20% to 26%. The performance gap between the top-quartile and
bottom-quartile funds has widened for vintages 2017–18. Median returns remained stable (see Figure 19).

Asia-Pacific funds’ net distribution to LPs improved slightly and was positive in 2024, recording a modest
uptick year on year. Given the dismal exit performance of the past three years, fund managers will
continue to make DPI a top priority (see Figure 20). According to the MSCI proprietary market index,
private equity continued to outperform public markets, especially in the 10- and 20-year time periods.

19
 Asia-Pacific Private Equity Report 2025

Figure 20: LPs had positive net cash flow for the first time since 2021;
private equity continues to outperform public markets

Cash flow for Asia-Pacific buyout Asia-Pacific private equity vs.

and growth funds ($B) public market
Contributions Distributions End-to-end pooled net internal rate of return
Net cash flows (as of September 2024)

$35B Asia-Pacific buyout funds

MSCI All Country Asia ICM IRR
25
11% 11%
10% 10%
15
8%
5
7%
–5

–15

–25

5 10 20
–35
2014 Q1–Q3 Investment horizon (years)
24

Notes: Data for Asia-Pacific calculated in US dollars; MSCI All Country Asia ICM IRR is a proprietary private-to-
public comparison from MSCI that evaluates what performance would have been had the dollars invested in
private equity been invested in public markets instead
Source: MSCI (as of September 30, 2024)

20
The value creation imperative

The golden decade of multiple expansion is long over. Higher interest rates, slowing economic growth,
and geopolitical tensions have reshaped the private equity landscape. Today, only 24% of Asia-Pacific GPs
cite multiple expansion as a top contributor to performance, down from 69% five years ago (see Figure 21).

Unable to count on market conditions driving up the value of portfolio companies relative to earnings, PE
funds are turning to value creation plans (VCPs) that energize growth. In the Asia-Pacific region, 53% of
GPs cite top-line growth as a key factor shaping 2024 returns, and they see that figure rising to 62% over
the next five years, according to a recent Bain survey.

Many are also deploying generative AI, despite its complexity, as an additional force to propel the top line
in a wide array of industries. Yet challenges persist. Nearly 50% of GPs we surveyed said they fail to meet
the growth expectations for their portfolio companies in more than half the deals they close. Often, the
problem is a lack of alignment between the PE fund and management on priorities and execution.

Path to value creation

The most effective VCPs succeed because they clarify strategic goals, focus on a small number of
high-impact initiatives, and provide a roadmap for execution. These plans help PE owners and portfolio
company management teams align on timelines, targets, and resources.

In recent years, growth-oriented strategies have become the centerpiece of around 60% of VCPs, reflecting
their critical role in achieving outsized returns. While some strategies integrate growth and overall business
transformation from the outset, others phase in strategic shifts later in the ownership period.

Advent International, for example, made growth its top priority when it acquired Bharat Serums and
Vaccines (BSV), an Asia-Pacific-based pharmaceutical company. The VCP quickly fueled a rise in
revenues while setting in place longer-term initiatives that enabled BSV to more than triple its valuation
prior to its sale to a strategic acquirer. The rapid growth acceleration plan succeeded because the
company’s key strategic choices were well defined and due diligence had identified a clear set of
growth opportunities.

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 Asia-Pacific Private Equity Report 2025

Figure 21: GPs say top-line growth will be key to fueling future returns

What was the biggest contributor to returns, and how is it likely to

change over time?
5 years ago Now In 5 years

Percentage of respondents
69
62
55% 53

41
35 33
28
24 23
18 15
14
12
9

Top-line Cost M&A Multiple Leverage

growth improvement and expansion
capital efficiency

Source: Bain & Company Asia-Pacific Private Equity Report survey, 2025 (n=130)

Advent, in fact, had a running start. It monitored BSV for several years prior to acquisition and worked
closely with founders and management during the sales process and diligence to design a blueprint for
growth. The plan overhauled the company’s domestic go-to-market strategy, optimizing the salesforce
network, distribution channels, licensing agreements, and pricing. At the same time, BSV expanded
internationally into five high-potential markets, evolving from an export-focused sales model to one based
on local presence and marketing. Increased R&D spending bolstered the product pipeline, while targeted
acquisitions gave the company access to new products and markets, strengthening its leadership position
in core domestic markets.

These efforts propelled annual revenue growth to 20% in the first three years of Advent’s ownership, up
from 10% prior to acquisition. BSV’s international revenues more than doubled during the last three years
of ownership and accounted for nearly half the company’s revenue at the time of exit. Increased scale,
new high-margin products, and optimized pricing helped boost BSV’s EBITDA margin from 20% at the
time of acquisition to 30% at the time of exit.

Balancing growth and strategy

Top funds refine strategy and pursue top-line growth initiatives in parallel when PE owners and company
managers have not yet aligned on strategic priorities. One PE fund used that dual approach to transform
the trajectory of a healthcare services provider operating across the Asia-Pacific region, doubling both
revenue and EBITDA during the ownership period.

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 Asia-Pacific Private Equity Report 2025

At the time of acquisition, the business had a strong core strategy and significant growth opportunities,
but the fund and company management needed to determine which opportunities to prioritize. While
aligning on strategic options, they pursued several obvious quick wins identified during diligence,
including direct-to-consumer marketing campaigns, which boosted web traffic by 40%, and online
bookings, which increased by 120%. Enhanced salesforce efficiency added additional revenue gains,
creating the foundation for future growth.

In today’s volatile market, value-creation plans are ever more

critical to PE success. The best funds are making growth
their edge.

As the business scaled, the PE team and management turned their attention to broader transformation.
Generative AI solutions streamlined operations, automating online booking processes and cutting manual
intervention by more than half in initial pilots. AI transcription tools reduced reporting time by over 50%
in some cases, enabling employees to focus on higher-value work.

While most PE funds pursue some kind of value creation plan for most deals, top funds differentiate
themselves in several ways. They do rigorous due diligence to validate their deal thesis and gauge the
potential for value creation. They also identify immediate management priorities (strategy, growth, cost)
and sequence initiatives accordingly. For the most important initiatives, top funds ensure the entire
organization understands the plan’s goals. They also make clear which managers are responsible for
executing the plan, milestone deadlines, and key performance indicators to track progress.

In today’s volatile market, VCPs are ever more critical to PE success. The best funds are making growth
their edge.

23
PE-backed carve-outs are plentiful,
but it’s harder to find winners
Corporate carve-outs remain a significant source of private equity deals in the Asia-Pacific region, bucking
a global decline. In 2024, carve-out deals totaled 20% of all buyouts over $100 million (see Figure 22). But
the days are gone when carve-outs produced sizzling multiples.

Since 2015, the results have been mixed. The median multiple on invested capital (MOIC) for carve-outs
in the Asia-Pacific region between 2015 and 2021 was 1.4x, on a par with the MOIC for all PE deals. From
2000 to 2014, the median MOIC for carve-outs was 3.1x, compared with 1.9x for all PE deals (see Figure 23).

Despite lower average returns, 44% of Asia-Pacific general partners (GPs) we surveyed consider carve-
outs a top investment opportunity (see Figure 24). One reason: Huge conglomerates in Japan and Korea
continue to rationalize operations and sell off business units. Since 2013, more than 25% of Japan’s
buyouts valued at more than $100 million have been carve-outs. These deals include some of the region’s
largest ever PE deals, such as Bain Capital’s acquisition of Toshiba’s memory chip unit (now known as
Kioxia) and KKR’s acquisition of Hitachi’s logistics arm (Logisteed). Carveouts in South Korea during the
same period represented nearly 30% of buyouts over $100 million.

The huge business groups in these countries have plenty of scope to continue rationalizing, especially in
South Korea, where the combined revenue of the five largest chaebols, or family-led conglomerates,
represents about 50% of the total revenue generated by the country’s largest companies. In 2024, large
carve-outs included Apollo’s acquisition of Panasonic Automotive Systems in Japan and Affinity’s
purchase of SK Rent-a-Car and Lotte Rental in Korea. Carve-outs also increased throughout the Asia-
Pacific region. In India, EQT and ChrysCapital jointly acquired 90% of HDFC’s education loan arm, HDFC
Credila, while Brookfield snapped up American Tower Corporation’s operations in India. In Australia,
Healius sold its diagnostic imaging arm, Lumus Imaging, to Affinity. In China, where full-control carve-
outs have been rare in recent years, a PAG-led consortium acquired a 60% stake in Wanda Group’s mall
management business.

Carve-out appeal

The classic corporate carve-out rides on the thesis that a private equity company could unlock
significantly more value from a non-core business than its corporate parent could. These businesses may

24
 Asia-Pacific Private Equity Report 2025

Figure 22: Carve-out deals rose sharply in 2024, after three years of decline

Carve-outs as a percentage of Asia-Pacific buyout deals over

$100 million
28%
25%
22% 21%
20% 21%
19% 20%
17%
16% 16%

11%

2013 14 15 16 17 18 19 20 21 22 23 24

Sources: AVCJ; Bain analysis

Figure 23: Carve-outs once outperformed other deal types; since 2015, that
advantage has eroded

2000–14 2015–21
Top quartile Median Bottom quartile

Gross deal MOIC in Asia-Pacific region Gross deal MOIC in Asia-Pacific region
Buyout and growth deals over $100 million Buyout and growth deals over $100 million

3.1x

1.7x 1.9x
1.4x 1.4x 1.4x

Carve-outs Primary, All PE Carve-outs Primary, All PE

secondary, and deals secondary, and deals
public-to-private deals public-to-private deals

Notes: All calculations in US dollars; deal universe includes fully and partially realized deals in the Asia-Pacific
region, transactions over $100 million in equity check size (excludes debt), buyout and growth deals; MOIC
(multiple on invested capital) is the ratio of total distributed capital plus remaining unrealized value divided by total
investment cost
Source: DealEdge

25
 Asia-Pacific Private Equity Report 2025

Figure 24: GPs see greater opportunity in carve-outs than secondary and
public-to-private deals

Where do you see the most interesting investment opportunities?

(Select up to 2 options)
Percentage of respondents

62%

44

31 28

Companies with no Carve-outs Secondary or Public-to-private

previous investment sponsor-to-sponsor deals
by a financial sponsor deals

Notes: Excludes other responses (2%); carve-outs: subsidiaries or select assets/operations of larger corporation or
conglomerate; secondary or sponsor-to-sponsor deals: company is fully or partly owned by a financial sponsor
Source: Bain & Company Asia-Pacific Private Equity Report survey, 2025 (n=130)

underperform simply because the corporate owner has other priorities. Value flows from a sharper
strategy, capital injection, more efficient operations, or finding new ways to grow—all while freeing the
business from corporate constraints and slow decision making. Corporate sellers, eager for a share of the
upside potential, often take a minority stake in the new company.

Historically, another factor has also been critical—the carve-out discount. These assets have tended to sell
at a lower multiple than standalone buyouts because separating them is costly and complex, limiting the
number of potential buyers. As private equity has become more competitive, however, the sheer volume
of firms pursuing these deals has put upward pressure on multiples, and corporate owners have become
smarter about running competitive auctions. These factors have pushed up acquisition prices and turned
the spotlight on private equity’s ability to add value—or not.

Top-performing PE firms heed several key principles when pursuing carve-outs:

Value creation shapes the agenda. Any good buyout starts with a robust thesis for improving the asset.
But carve-outs add an additional layer of complexity since the investor must extricate the business from
its corporate parent and set it up as a fully independent enterprise. It doesn’t help that few carve-outs
have standalone financial reporting, making it difficult to break down shared costs and determine the real
profitability of the business.

Separation fundamentals are important. Seasoned carve-out sponsors know how to determine which
of the business’s personnel, assets, legal entities, data, and systems are included in the deal perimeter

26
 Asia-Pacific Private Equity Report 2025

(vs. held back by the parent). Planning must untangle a spaghetti bowl of complex interdependencies
with the parent in finance, human resources, and IT. Clean separation requires amending hundreds or
thousands of agreements with suppliers, service providers, and other third parties. And buyers need
special expertise in drafting the many transition service agreements (TSAs) that lay out the services
and support that the seller will extend to the new company for a defined period. Indeed, there’s an art
to structuring the transaction so the seller views the separation process as “our problem,” not just
“your problem.”

But in negotiating this thicket of challenges, the most effective carve-out sponsors keep a sharp focus on
the value creation plan. The overarching rationale for the deal helps acquirers prioritize what’s critical to
achieve and in what sequence. Crisp execution increases the odds of success. If management cuts costs
when growth initiatives are needed or spends two years transferring the ERP system at the expense of
building new tools to better understand customer needs, the waste of time, energy, and resources can
quickly diminish the return.

In negotiating this thicket of challenges, the most effective

carve-out sponsors keep a sharp focus on the value
creation plan.

Take the case of an international PE fund that acquired the facility management and maintenance
subsidiary of a large conglomerate and is now on track to double EBIDTA over a five-year period. The due
diligence had convinced the investor that it had an opportunity to accelerate growth and improve
performance. At the time of purchase, the subsidiary was healthy and was growing at a steady but
modest rate, with stable margins. It served some external customers, but its largest customers and more
than half of its revenue still came from captive clients within the conglomerate.

The PE fund worked with the management team to acquire new customers outside the former parent
group by bidding on more contracts. It also helped the group improve its success rate by enhancing sales
capabilities and processes. Another major initiative involved moving beyond traditional facility management
into higher value-added, high-margin businesses such as property management and lease management.
To support these changes, the new owner invested in a more advanced integrated sales system and
revised the rewards structure and incentives for sales teams.

Tough decisions can’t wait. One reason large, bureaucratic businesses often underperform is
because leaders defer sensitive or painful decisions. They continue funding underperforming business
units, unprofitable geographies, excess management layers, inefficient marketing, subpar suppliers,
and underutilized real estate portfolios.

27
 Asia-Pacific Private Equity Report 2025

Delayed decisions may be a symptom of corporate sloth or blurred focus. But large corporations may
also have different objectives than PE investors, not to mention a lower cost of capital and more lenient
timelines. A corporate owner, for instance, might support a business with strong top-line growth, but
poor cash flow, simply to burnish quarterly revenue or avoid admitting defeat. PE owners rarely have
that luxury.

What’s essential is hitting the ground at full speed with the license to make changes immediately. That
was the plan when an international PE fund acquired the subsidiary of a large company producing a
range of industrial equipment, hardware, and electronics. Due diligence had revealed a business with
strong products in many categories and vigorous customer advocates. However, it was clear the business
was not performing at full potential. It had flat or slightly declining market share in several categories,
and its margins were considerably lower than those of its peers.

The PE fund quickly overhauled the company’s organizational structure, installing a new CEO and senior
management. The transformation led to significant efficiencies in headcount and reduced spending in
functions such as general and administrative roles, sales, product management, and marketing.

The new owner also identified that cost inefficiencies weren’t the only reason the company’s margins
lagged peers. On many products, the pricing level after discounts had not kept up with cost growth in
many product categories and regions. The PE fund helped the management team selectively implement
increases in list prices and tighten protocols for discounts for offerings where there was limited risk of
customer churn. Those efforts have put the PE fund quickly on course to exceed its margin improvement
and growth targets.

Matching leadership to mission. Rapidly addressing talent issues can often make or break a deal. Many
carve-outs come with capable leaders who have grown up in a cozy, slow-moving corporate world. But
PE-backed carve-outs are anything but cozy and slow moving. Managers not trained in transforming
businesses may underperform when PE investors ask them to dial up the metabolism. And they might
not have the skills that are vital to executing the new strategy.

PE firms need to quickly identify which roles and functions are required to deliver on the deal’s ambition
and what needs to be accomplished over what period. That provides a fact base for rapidly finding and
installing executives with the right experiences, capabilities, and motivations to meet those requirements,
whether they come from inside the company or are recruited externally.

Go in prepared. The decline in carve-out performance underscores how challenging it is to get carve-
outs right. Yet deep expertise, careful due diligence, and active management can pave the way to top-tier
results. The firms getting this right start with a clear, actionable value creation plan.

Standing up a new company is only half the battle when it comes to carve-out success. Outperforming
the averages relies on moving rapidly from Day 1 to ensure that a clear deal thesis translates into
next-level performance.

28
Market definition

The Asia-Pacific private equity market as defined for this report

Includes:

• Investments and exits with announced value of $10 million or more

• Investments and exits completed in the Asia-Pacific region: Greater China (China, Taiwan, Hong Kong,
and Macau), India, Japan, South Korea, Australia and New Zealand, Southeast Asia (Singapore,
Indonesia, Malaysia, Thailand, Vietnam, the Philippines, Laos, Cambodia, Brunei, and Myanmar), and
other countries in the region

• Investments that have closed and those at the agreement-in-principle or definitive agreement stage

Excludes:

• Franchise funding, seed, and R&D deals

• Any non-PE, non-VC deals (including M&A and consolidation)

• Real estate (including hotels and lodging) and real estate investment trusts

• Pure hedge fund PIPE investments (private investments in public equity with hedge fund as the
single investor)

• Fund-raising of RMB-denominated funds

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