Last Updated Apr 22, 2008 3:07 PM EDT
- The Find: More than half of M&A deal-makers expressed significant interest in China, India and Southeast Asia despite their belief that risks in the region nearly equal those in Africa.
- The Source: "M&A Beyond Borders: Opportunities and Risks," commissioned by Marsh, Mercer and Kroll and drawing on research by the Economist Intelligence Unit.
Why is Asia so risky? Deal-makers cited the usual -- "questionable business practices" and "intellectual property protection." More surprising, considering press coverage of China's pollution woes, were concerns over recently passed environmental regulation. Though China still lags far behind the U.S. and Europe on this front, the report cautions companies to be aware of tougher laws and stricter scrutiny.
Don't think the risks will stop companies from doing deals, however. Karen Beldy Torborg, Global Head of Marsh's Private Equity and M&A Practice, reminds us that "despite the perceived risks of investing in this region, the level of M&A activity in recent years suggests that the expected reward is much stronger."