SINGAPORE (June 15): The value on mergers and acquisitions (M&A) involving Singaporean companies have hit US$11.8 billion ($16.3 billion) as 2Q17 comes to a close, says Thomson Reuters in a review released on Thursday.

This is a 10.4% increase from 1Q17 despite a 16.3% drop in announced deals. For 1H16, this is a 20.3% decrease to US$22.4 billion in overall M&A activity even as deals decline 23.4%.

This makes the 1H17 the slowest for Singapore deal-making activity since 2013.

The average M&A deal size for disclosed deals dropped to US$89.8 million compared to US$93.6 million 1H16, as Singapore-involved M&A activity this year lacked deals US$3 billion and above compared to US$7 billion from two deals in the same period last year.

So far this year, completed M&A deals involving Singapore amounted to US$33.3 billion, an 83.7% increase from US$18.1 billion in the first half of 2016.

The real estate sector took the lead and accounted for 40.3% of the market share worth US$9.1 billion, up 64.1% in terms of deal value, from 1H16.

This is the highest in the first half period for the sector since 2014 which hit US$17.7 billion, driven by two of the biggest Singapore deals to date – Mapletree Investments’ acquisition of Kayne Anderson Capital Advisors’ student housing portfolio for about US$1.6 billion in cash and Marcatus Co-operative’s acquisition of Jurong Point Shopping Centre for US$1.57 billion.

Private equity-backed M&A activity in Singapore saw a decrease of 76.9% worth of deals (US$120.2 million) so far this year as compared to 1H16. This is the lowest first half period in terms of deal value since 2013.

Foreign acquisitions targeting Singapore-based companies also saw a decrease of 16.7% from 1H16, reaching US$5.6 billion so far this year. This is the lowest semi-annual start since 2013 when deal value for inbound acquisitions in Singapore reached US$1.7 billion.

The Industrials sector accounted for 42.3% of Singapore’s inbound M&A activity and totalled US$2.4 billion, up 49% from the first half of 2016.  This was driven by HNA Belt & Road Investments (Singapore)’s, ultimately owned by China-based HNA Holding Group Co, pending acquisition of the entire share capital of CWT, a Singapore-based provider of integrated logistics solutions and management services, for a total value of US$1.3 billion, including net debt.

The deal also pushed China as the most active acquiror in terms of deal value, capturing 30.8% of Singapore’s inbound activity. Hong Kong, Canada and the United States followed behind with 16.5%, 16.4% and 15.4% market share, respectively.