KUALA LUMPUR – Malaysia is prime for prominence on the private equity (PE) stage in ASEAN which is expected to reach US$70 billion in deal value by 2024.
Ekuiti Nasional Bhd (Ekuinas) chairman Raja Tan Sri Arshad Raja Tun Uda said while the asset class continues to develop locally, there is no shortage of opportunities on the horizon, prompting investors and other players to up their allocations into PE as part of their diversification strategy.
“We are indeed fortunate to be in the exciting region of growth that is paving the way for our markets to mature and thus, increase the appetite for expansion, mergers and acquisitions,” he said in his welcome address at the Malaysian Private Equity Forum 2019 here today.
Raja Arshad said the prospect of investing in the next world-class companies, and rapid growth taking place across various sectors and countries in the region is promising.
“This promises abundant investment opportunities in ASEAN, creating the impetus for vibrant PE activities in this region,” he said.
Nevertheless, he said investors need to understand the challenges of regional complexities and cross-border expansions.
On Ekuinas’ role, he said its focus remained to play an active role in providing Malaysia’s businesses and entrepreneurs with the building blocks to accelerate their plans and growth whilst contributing to Malaysia’s wider economic development.
“As we look forward to future endeavours, we are mindful of our importance in playing a key role in nurturing the growth of companies, industries and the nation,” he said.
He said apart from being commercially driven, Ekuinas is a unique private equity firm that contributes to society through its social objectives.
“Over the years, the returns we made have helped us realise our corporate social responsibility vision that reflects our core business agenda and create a sustainable and positive impact to businesses and society,” he said.
Raja Arshad said with a conducive environment that has been built upon over the years, Ekuinas also wanted the private equity asset class to be seen as a key instrument, from seeding emergent companies and industries to building the nation’s next generation of leading regional and global companies.
“We are also confident that through these efforts and initiatives, the wider market will benefit, thus, creating a vibrant and dynamic business environment,” he added.
Meanwhile, chief executive officer Syed Yasir Arafat Syed Abd Kadir said private equity deals are expected to remain subdued until next year, driven by lofty valuation expectations of private equity assets.
“This year, everybody is taking a very cautious view, in light of expanding multiples,” he said, adding that there has been a number of deals in the private equity market earlier this year that was deemed expensive.
He said this has set the tone for some of the deals that Ekuinas is working.
“We have to remain disciplined and focused and pay what a company is worth,” he said.
Since its establishment in 2009, Ekuinas has invested in 23 companies with a total fund under management stood at RM4.1 billion as at September this year.
The one-day event, organised by Ekuinas, focused on promoting private equity as an attractive strategic asset investment class.
The forum gathered about 400 attendees, comprising leading equity professionals, senior investors and business decision-makers.