With turnaround skills honed in the West, private equity investors are sweeping underperforming Asian corporations into their portfolios and retooling the management at these firms to boost shareholder value. Last year, PE investors accounted for about 11% of all merger and acquisition activity in Asia, deploying more than $100 billion across the region. In research on PE activity in Asia, conducted with our colleague Bertrand Pointeau, we’ve identified three principal strategies activist funds are using to strengthen Asian acquisitions. As a case in point, consider how Newbridge Capital, a partnership between private equity luminaries Texas Pacific Group and Blum Capital Partners, rapidly transformed Korea First Bank from a bankrupt industrial creditor into a world-class financial institution.
Turbocharging Asian Turnarounds
With turnaround skills honed in the West, private equity investors are sweeping underperforming Asian corporations into their portfolios and retooling the management at these firms to boost shareholder value. Last year, PE investors accounted for about 11% of all merger and acquisition activity in Asia, deploying more than $100 billion across the region. In research […]
Summary.
Reprint: F0606J
Private equity investors in Asia are fine-tuning the art of the turnaround using three principal strategies.
A version of this article appeared in the June 2006 issue of Harvard Business Review.