Recent events surrounding the future ownership of Hong Kong fixed-line carrier PCCW [see Hong Kong: Wrong connections] offer evidence that Asia’s private equity market might be overheating. The zeal with which Texas Pacific Group and Macquarie have pursued an acquisition of the key assets of the group suggests that they might be struggling to find suitable investments in the region.
As much as $100 billion of capital, on a fully leveraged basis, is believed to be seeking a home in the region. Putting that kind of money to work in investments that will produce the kinds of returns limited partners have come to expect will be a very tall order. It is hard...
