Global M&A volumes grew 45% in the first half of the year, while volumes in Asia Pacific (APAC) fell roughly 10% over the same period — numbers that tell only part of the story.

“That headline figure belies an actual intensity of conversations that we are having with clients on a number of strategic initiatives,” said Rohit Chatterji, Head of M&A, Asia Pacific at J.P. Morgan.

Several themes stand out in what's driving APAC deal activity. Shareholder activism is surging — 114 campaigns in Asia in the first half of the year, representing 45% of all global campaigns, concentrated in Japan but spreading into Korea and Australia. 

Sponsor-driven deals are also contributing a meaningful share, accounting for roughly 25% of APAC M&A volumes, as private equity firms that delivered strong exits in recent years return to market with large new funds and capital to deploy. 

At the same time, corporates are pursuing strategic moves into adjacent capabilities or new markets closer to customers and demand, while AI-led transactions are gathering pace as hyperscaler capital expenditure (capex) exerts a gravitational pull on deals across networks, components and the broader AI supply chain.

“All four of those themes we are seeing with companies of all sizes,” said Kerwin Clayton, Co-Head, Global Corporate Banking, Asia Pacific at J.P. Morgan.

Growth versus profitability remains a sector-by-sector calculation, with many corporates asking whether a transaction is needed to build scale and profitability, particularly in sectors where consolidation is now the dominant theme.

That calculation often plays out over the long arc of a client relationship. “From the conversations the corporate bank has with clients from the time they were much smaller companies to bigger scale, it's a natural corollary to come in and discuss whether they're ready for a strategic move — raising capital privately, publicly or through an IPO,” Chatterji said.

“Most of the time we're speaking to CEOs or founders, and having that relationship where you can introduce them to someone else from the team for a more pointed strategic discussion is pretty natural,” added Clayton.

How are corporates managing FX and rate risks?

After more than a decade of stable policy rates and abundant liquidity, 2026 brought a decisive shift: central banks across Asia Pacific (APAC) are pulling in different directions, reshaping how companies borrow, refinance, invest and hedge.

Japan, Korea, Indonesia and the Philippines are hiking, while China could be cutting, varying the cost of funding from market by market and company by company across the region.

“After years of a very low rate environment, corporates expected the recent rise to be temporary in nature. Instead, we find ourselves in a higher-for-longer rate environment. Large corporates with sophisticated treasuries can absorb those swings, versus small and medium-sized companies that have less hedging in place and more margin pressure,” said Oliver Brinkmann, Co-Head, Global Corporate Banking, Asia Pacific at J.P. Morgan.

Japan and Korea have intervened directly to steady their currencies this year; Japan spent around $100 billion in coordination with the U.S. to support the yen, materially reshaping how corporate Japan funds and hedges.

“In the case of the yen, hedging costs have fallen materially — to four-year lows — and are likely to go lower still. We're currently around 2.8%, and could head toward 2.5%,” said Rahul Deora, Head of Corporate FX & Rates, Asia Pacific and Head of Local Markets Sales, South Asia, at J.P. Morgan.

Technology and high-growth companies are the most rate-sensitive — higher rates compress forward multiples and lift the cost of capital, reshaping how projects are funded and how founders plan for exits. Nowhere is that clearer than in the hyperscalers and AI infrastructure driving the region's next investment wave.

Global AI-related capital expenditure is projected to approach $870 billion by the end of 2026 — a 77% year-over-year climb, on top of around $5.5 trillion in data center spending over the five years to 2030. Asia Pacific's semiconductor makers, cloud infrastructure providers and high growth startups are among the biggest beneficiaries, though the opportunity remains complex for founders navigating it.

“We’re at the precipice of a platform transition that creates an unbridled opportunity in AI. At the same time, there are crosswinds — whether geopolitical, macroeconomic or supply chain-related. Founders need to build for both growth and resilience,” said Mark Fiteny, head of TMT and New Economy Investment Banking, Asia Pacific at J.P. Morgan.

Venture capital is shifting accordingly: while value still accrues at the application layer, funding increasingly flows toward "physical AI" — robotics, automation, edge computing and quantum computing.

What the oil supply shock means for companies

While tech sector investment is looking ahead, energy markets are grappling with a more immediate challenge. Crude oil markets are facing one of the most severe supply shocks on record, driven by the Middle East conflict and its cascading effects across global trade routes.

“Headline fatigue is setting in. But don’t mistake the price moves for stability. The real impact is being felt on the product side — gasoline, diesel, liquefied petroleum gas (LPG), jet fuel. That’s where the real stress is,” said Raman Walia, head of Commodities Sales for Asia Pacific at J.P. Morgan.

Airlines, refineries and industrials are among the hardest hit, grappling with cash flow disruption, counterparty credit risk and margin compression. For treasurers, the priority is liquidity visibility — knowing what cash is available, where it sits and how fast it can move.

“Crude oil and petrochemicals are inputs for manufacturers across Asia Pacific. Increased costs are cascading across industries — from plastics and polymers to packaging,” said Amalia Lazarus, head of Subsidiary Banking for Asia Pacific at J.P. Morgan.