DFDL's Nishant Choudhary is featured on Asia's M&A Predictions 2022
In spite of the persistence of the COVID-19 pandemic, the Asian region witnessed an incredibly strong performance when it came to mergers and acquisitions in 2021. Can we expect the same in 2022? Lawyers in key Asian markets weigh in, predicting trends for the next year and beyond.
Myanmar is enduring an economic slowdown due to the pandemic and the current political situation. While distressed M&A in Myanmar is nascent, we believe that in 2022 most of the M&A activity will be distressed sales. In the last five years, several sectors have been opened to foreign investment. Although there still exists a level of difficulties, it is still manageable. We are already seeing signs of distress in certain sectors such as hospitality, telecommunication, and oil and gas. However, given the political situation, there would still be a marketability concern even at a price representing the distress of the seller, leading it to become a zero-sum game. Concerning the marketability issues, we have seen creditors being more flexible for restructuring the debt components and agreeing to a longer moratorium period. Though there would likely be limitations up to which the creditors would continue to be flexible.
Nonetheless, there is the expectation of opportunistic investments from within the region, particularly China, Vietnam, Thailand, etc. On investment opportunities, Myanmar is a large domestic market with a population of approx. 53 million. There would be local demands to sustain the business, which had dipped due to security, political, and pandemic concerns. The more Myanmar moves towards peace and stability, the more efficient the business environment will become.
- Nishant Choudhary, partner and deputy managing director, DFDL Myanmar
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