SINGAPORE Law and Practice Contributed by: Evelyn Wee, Sandy Foo, Tracy-Anne Ang, Terence Quek, Hoon Chi Tern, Goh Jun Yi and Tricia Teo, Rajah & Tann Singapore LLP
1. Transaction Activity 1.1 Private Equity Transactions and M&A Deals in General Singapore is a key hub for fund managers and invest - ment entities, and continues to serve as an entry point for regional South-East Asian private equity (PE) and investment activity. South-East Asia remains a rich hunting ground as high-growth companies in the region start to mature. Many South-East Asian businesses have been restructured to include and/or have been established using Singapore-incorporated holding entities and/or raised capital through these, which has continued to help drive deal flow in Singapore for PE/M&A activity. Capital markets and treasury conditions remain chal - lenging, however, and this has contributed to a marked increase in private credit funds and investment/acqui - sition transactions structured with private credit com - ponents. The challenging capital market environment has also played a part in increasing South-East Asia PE secondary activity. However, there appears to be improved investment sentiment and greater interest in traditional exit routes for PE investments, which, coupled with recent initiatives introduced by the Sin - gapore government to improve the vibrancy of the Singapore equities market, could result in a more active IPO market (whether in Singapore or otherwise) in the coming years as an international capital-raising platform for high-calibre companies and a viable route for PE exits. 1.2 Market Activity and Impact of Macro- Economic Factors Strong PE activity in Singapore continued amidst the sharp rebound in PE deal values in South-East Asia in 2024 in specific sectors such as digital infrastruc - ture, healthcare and semiconductors. However, the recent tariffs introduced by the second Trump admin - istration have resulted in significant uncertainty in pri - vate equity deal-making in the first half of 2025, with the macro-economic uncertainties leading to slower M&A activity, wider valuation gaps and more cautious investment strategies.
Singapore’s state investor, Temasek, stated in 2021 that it expected to increasingly shape its portfolio in line with four structural trends: digitalisation, sustaina - ble living, future of consumption and longer lifespans. This continues to be an accurate description of the trends in investment and M&A activity in 2025. Sec - tors that continue to see healthy deal interest broadly fall into the above-mentioned categories: digital infra - structure, healthcare and semiconductors. 2. Private Equity Developments 2.1 Impact of Legal Developments on Funds and Transactions The following changes to the law, practice and regula - tions in recent years have either already had an impact on the private equity community and private equity transactions or may do so in the future. Significant Investments Review Act 2024 and Transport Sector (Critical Firms) Act 2024 The Significant Investments Review Act came into force on 28 March 2024 and applies to both local and foreign investors. The Act sets out a new investment management regime, which seeks to strengthen the resilience of Singapore’s economy and enhance Sin - gapore’s national security by ensuring the continuity of critical entities. Entities that are critical to the secu - rity interests of Singapore, but which are not caught by existing sector-specific legislation, may be desig - nated under the Act (“Designated Entities”). The enti - ties must be incorporated, formed or established in Singapore, carry out activities in Singapore, or provide goods and services to persons in Singapore. The inaugural list of Designated Entities was published on 31 May 2024, and includes nine entities which are key providers involved in the petrochemicals indus - try, manufacturing of defence equipment and security solutions, marine and shipbuilding services, and digi - tal services. Designated Entities are subject to, among other things: • the requirement to notify or seek approval for cer - tain specified changes in ownership and control; • the requirement to seek approval for appointment of key officers; and
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