Sweden’s EQT has reached an agreement to acquire Baring Private Equity Asia, a leading private markets investment firm in Asia with EUR 17.7bn of assets under management.
In this company announcement, the global investment organization said that expanding in Asia is a strategic priority for EQT, as the region accounts for more than a third of global GDP today and is expected to contribute 40%+ of global GDP growth by 2030.
With 24% CAGR since 2015 and reaching ~USD 2.1tn in 2021, Asia is the growth engine underpinning global private markets (compared to 14% CAGR for Europe and North America combined). This trend is expected to continue as Asian private markets benefit from favorable long-term structural tailwinds.
Global private markets firms are increasingly taking share in the underpenetrated Asian private markets, but still, only represent 34% of the total market. With this combination, EQT is ideally positioned to take market share in and capitalize on the Asian growth opportunity with its truly global reach and scaled active ownership platform in Asia.
BPEA is a top-3 private markets investment manager in Asia with EUR 17.7bn AUM, currently investing from its flagship Private Equity Fund VIII, which had its first close in September 2021.
Operating since 1997, BPEA has built a platform with deep sector-based expertise and a value-driven active ownership approach, investing in mid to large-cap companies in Asia, mainly focused on Private Equity, but also Real Estate and more recently Growth. With 10 regional offices, BPEA combines local execution with a Pan-Asian reach (236 FTE+ as of 2021), mirroring EQT’s local-with-locals approach. BPEA has made 100+ Private Equity investments since its inception and has a track record of generating strong returns for its clients, with 2.6x realized gross MOIC since inception(3). With its deep, long-standing relationships with 300+ clients and best-in-class fundraising ability, BPEA is well-positioned to capitalize on the outsized Asian growth opportunity.
The combination represents a step-change in EQT’s global reach with immediate Pan-Asia presence at scale and with its thematic investment approach, supporting companies from early-stage to maturity, EQT will continue to scale and expand its range of strategies across its European, North American, and Asian core markets and deliver for its clients.
Christian Sinding, CEO and Managing Partner of EQT said, “We are very excited to join forces with BPEA, which represents a step-change in our global reach with immediate Pan-Asian presence at scale. Expanding our footprint in Asia is part of the strategic objectives we set out at the time of our IPO, and BPEA represents a unique opportunity, as a well-established and top-performing firm in the region, to enhance our global platform and position us to capitalize on the structural growth opportunity in Asian private markets. With its thematic sector-based approach, strong track-record in value creation, and most importantly, a learning culture and long-term partnership approach, we feel deeply aligned with BPEA. We are truly impressed by what Jean and the BPEA team have built over the past 25 years. A perfect cultural and ideological fit with EQT, and a unique opportunity to establish EQT as a world-leading private markets platform with a scaled Asian platform and truly global reach”
Jean Eric Salata, CEO, and Founder of BPEA said, “We are thrilled to embark on this journey with EQT and by the possibilities that this combination creates. It is a game-changer for both our firms and will accelerate our ability to deliver superior returns for our clients. The cultural fit between our two firms is remarkable and the strategic fit is very powerful. Combining our strong position in Asia with EQT’s world-class capabilities in sectors, such as Healthcare and Technology, their proprietary digital transformation and data analytics resources, and their leadership in sustainability will create a highly differentiated and extremely competitive private markets firm in Asia and globally. The future of Private Equity is about the ability to truly transform companies through active ownership strategies that deliver superior returns to clients throughout the cycle, regardless of the external environment. This combination positions us extraordinarily well to do exactly that at an industry leading-level.”
Read the full announcement with more on the matter here