APAC’s M&A market is showing strength as deal making exceeds pre-pandemic levels. In Australia, the value of the Australian M&A market hit AU$110bn in 1H21, on 447 deals a slight decline on deal numbers from 1H19.  Consensus suggests there is an upward trajectory for the remaining half of 2021 and into 2022 with strong market sentiment and majority of dealmakers with capacity to participate in the low interest rate, post pandemic economy.

In this environment Asset Based Lending (ABL) are supporting the M&A market with leveraged purchase opportunities. ABL structures allow for higher leverage in riskier industries and business activities supported by the company’s underlying collateral. AR, Inventory, PP&E and intangibles combined to maximise availability for a client.

An ABL structure covering AR and P&E was a used to support Allegro Funds recent acquisition of Toll Express as an example and Hilco were there in support providing our in-depth coverage of the collateral.

In our opinion global low interest rates, private & corporate investment, household consumption, and Government supported economic growth is likely to see the M&A markets continue to flourish until at least to end of 2022. In fact, Hilco are working on a record number of ABL related appraisal and diligence projects across a broad range of industries. Regardless of the industry or whether you are a buyer or seller going to market ABL might be the solution you have been seeking.

For confidential discussions on collateral and business reports contact Greg Hardiman or Ben Roden from Hilco APAC.