Earlier in the year a consortium led by Jiangsu Changjiang Electronics Technology acquired Singapore semiconductor company STATS Chippac, while China's Tsinghua has attempted to acquire US-listed Micron -- unsuccessfully so far.
“Asian companies are seeking value-added products, services, technologies and management skills in their acquisitions,” the survey said.
Announced M&A volumes in Asia Pacific have risen a great deal during 2015, hitting $1.05 trillion as of November 18. According to Dealogic, announced deal volumes are 60% higher than in the corresponding period of 2014.
However, the rise in volume is in large part down to a few rather chunky deals: a set of government-initiated China SOE restructurings; a $53 billion merger of Cheung Kong (Holdings) and Hutchison Whampoa, the two corporations of Hong Kong billionaire Li Ka-Shing; and a $24.9 billion internal merger of two divisions of Korean chaebol SK Group.
The number of announced M&A deals in Asia-Pacific this year is 11,363, just 3% more than in the same period in 2014.
All of the survey respondents named Asia as the region with the most potential for growth over the coming five years, followed by North America. As a result, intra-regional M&A remains a priority.
The survey's respondents said they were keenest on making acquisitions in mainland China, Indonesia, India, and Vietnam.
Outside of Asia the United States was seen as the key market for inorganic growth. Financial institutions and Chinese corporates in particular most favoured the country for outbound M&A. Meanwhile, businesses in Singapore and Taiwan were eager to acquire in China.
Greater patience, low hurdle rates
Asian companies seem to possess a lot of patience when it comes to assessing the success of consolidations, with 38% of respondents stating M&As required an investment time horizon of five years to be considered successful. Over 40% of participants said acquisitions required an investment time horizon of 10 years or more.
The companies also have relatively low expectations when it comes to the hurdle rate, or minimum rate of return expected on M&As. The respondents’ average hurdle rate was below 14.3%. Perhaps surprisingly, 23% of respondents said they didn’t consider a hurdle rate at all.
This finding appears to fit well with the willingness of Asian corporates to pay higher premiums for M&A acquisitions than their US or European peers.
JP Morgan said it conducted the survey "to separate myth from reality and provide fact-based insight into the Asian M&A market."
Geographically, 36% of the companies surveyed by the US bank were Japanese. Another third were from Southeast Asia, with the remainder coming from China, Korea, Taiwan, and Hong Kong.