SINGAPORE Trends and Developments Contributed by: Terence Quek, Benjamin Cheong and Favian Tan, Rajah & Tann Singapore LLP
ment opportunities in enterprise software, fintech and healthtech. Secondly, deal-makers in Singapore are deploying AI in M&A processes, such as to compress due diligence timetables, improve document analysis and enhance target screening. Singapore stands as a pack leader in AI assets and AI-enabled integrations, buoyed by a number of key factors. Importantly, Singapore has a reputation for its strength in data and analytics, combining a digitally mature economy with strong cloud adoption and one of the region’s most data-literate workforces. This is paired with strong data governance under an estab- lished legal framework, which includes the Personal Data Protection Act 2012, as well as widely used model governance toolkits, which gives buyers con- fidence to scale analytics responsibly after close. The toolkits include: • the Personal Data Protection Commission and IMDA’s Model AI Governance Framework, which is a set of guidelines and principles designed to help organisations deploy AI responsibly and ethically, with the most recent update in 2024 including generative AI; • AI Verify, which is Singapore’s national AI govern- ance testing framework and software toolkit, with the Global AI Assurance Sandbox launched in 2025 to cover new archetypes; and • the AI Markets Toolkit, which was launched in 2025 to help businesses evaluate AI technology for com- petition and consumer protection compliance. Singapore’s attractiveness as an AI investment target has also benefitted from the city-state’s pro-AI policy and a supportive investment environment. Singapore has developed a comprehensive, pro-innovation AI stance, which includes fast-tracking intellectual property and patent processes for emerging technol- ogy, incentivising private AI investment and compute adoption, and talent and skills pipelines to alleviate specialist shortages. Singapore also features a prac- tical and applied AI ecosystem, with public-private programmes delivering real implementations, such as Google’s collaborations with government agencies and local firms to prototype and productionise gen- erative AI, and AI Singapore’s SEA-LION and MER- aLiON large language models, which further increase
the integration value for acquirers headquartered in Singapore. At a fiscal level, Singapore has introduced several ini- tiatives to drive AI adoption, in line with Singapore’s National AI Strategy, which aims to harness AI’s full potential to drive economic growth, enhance the quality of life of Singaporeans and maintain Singa- pore’s position as a global AI hub. In Singapore’s 2024 national budget, the Singapore government unveiled a plan to invest SGD1 billion in AI development over the next five years, including up to SGD500 million to secure high-performance computing resources to drive AI innovation and capability building. Addition- ally, in the Singapore 2025 national budget, Singapore introduced the Enterprise Compute Initiative (ECI), an SGD150 million programme to help businesses adopt AI, as well as an SGD3 billion National Productivity Fund boost for efforts to drive tech and innovation. Continued growth in AI-native software and analytics targets in Singapore should thus be expected, along with consolidation around enabling infrastructure. Digital infrastructure and data centres The demand for data centre-related M&A is surging, driven primarily by the exponential growth of AI and the continued expansion of cloud computing. Gen- erative AI and high-powered computing workloads require significantly more power and specialised cool- ing systems than what traditional data centres can provide. Acquiring existing, ready-to-use facilities is quicker compared to developing new ones and pro- vides access to specialised engineering expertise, making M&A an attractive option for companies look- ing to expand their data centre capacity. This has led to record-breaking deal values, with investors looking to acquire operational capacity to meet the unprec- edented need for high-performance computing power. Singapore has emerged as one of Asia-Pacific’s most dynamic markets for digital infrastructure and data centre M&A, underpinned by seemingly unquench- able demand, limited supply and a supportive policy environment. Deal-making has centred on platform expansions, greenfield developments and capital rais- ing aligned with sustainability targets, with participa- tion from hyperscalers, colocation operators, private
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