Southeast Asia Private Equity Turns More Selective in 2025 with Indonesia Pivots to Consumer, Healthcare and Finance

• US$9.1b was deployed across 59 PE-backed deals in 2025, with transactions concentrated on digital infrastructure.
• Indonesia’s private equity focus is shifting to consumer, healthcare, and financial services as investors prioritize resilient cash generation and scalable growth.
• At exits, governance and readiness for transactions (trade sales or IPOs) are becoming increasingly critical.
• PE-backed exits were valued at US$4.4b across 33 deals.    

JAKARTA, 19 February 2025. Private equity (PE) deal value in Southeast Asia (SEA) moderated sharply in 2025, reflecting a more cautious investment environment compared with 2024. 

A total of US$9.1b was deployed across 59 PE-backed deals in 2025, down from US$16b across 67 deals a year ago – a year-on-year (yoy) decline of 43% and 12% in deal value and volume, respectively. This points to continued deal activity but fewer megadeals (deals above US$1b).  

Overall, the region saw four megadeals in 2025, compared with eight in the previous year. Among the deals where values were disclosed, average deal size dropped to US$267m from US$356m a year ago. 

For sectors, infrastructure, specifically digital infrastructure, accounted for 42% of PE investments, followed by telecommunications (12%), real estate (10%) and energy (10%). 

This is according to the EY Southeast Asia Private Equity Pulse 2025: Year-in-review, which provides a roundup of PE deals along with capital activities across major sectors in the region for the period between January and December 2025. 

On the region’s PE deal performance in 2025, Luke Pais, EY-Parthenon Asean Private Equity Leader, says: 

“While 2025 started with robust activity in Q1, geopolitical volatility and concerns over potential US tariffs led to more cautious investor sentiments seen in Q2. However, PE investment activity in SEA rebounded in Q3, which became the most active deployment period in 2025, reflecting a shift toward larger, more selective transactions as valuations stabilized and financing conditions improved. Notably, Singapore continues to be the regional anchor, accounting for over 74% of total PE value. This underscores the country’s role as a safe haven for capital in times of uncertainty. 

Looking ahead in 2026, digital infrastructure and renewables will likely remain primary beneficiaries with increasing convergence between compute growth and clean power solutions. We also expect to see more broad-based activity compared to 2025, with significant transactions in other sectors.”  

Indonesia PE Activity Shifts Toward Consumer, Healthcare and Financial Services

While the largest private equity transactions across Southeast Asia have often been concentrated in infrastructure and real estate, Indonesia’s deal activity over the past year has been more active in consumer-facing sectors, as well as healthcare and financial services. This reflects a shift toward sectors with clearer demand visibility and strong domestic fundamentals. Investors are also prioritizing businesses with resilient cash generation and scalable operating models as they navigate a more selective deal environment. 

Oki Stefanus, EY-Parthenon Indonesia Strategy and Transactions Partner, states: 

“Indonesia’s consumer sector continues to attract interest due to the strength of domestic consumption and a large base of middle-income and aspiring middle-income households. In healthcare, investors are responding to under-penetration, expanding insurance coverage, and rising demand for better healthcare quality. In financial services, low banking and credit penetration alongside rapid digital adoption continue to create scalable growth opportunities.” 

Indonesia remains a key market in Southeast Asia, supported by long-term fundamentals. Interest in buyouts and secondary transactions continues, although investors are becoming more selective. A notable trend is the ongoing role of foreign buyers in providing liquidity, particularly when local buyer appetite is softer. 

Oki, mentions: 

“While PE-backed listings on the Indonesia Stock Exchange were limited this year, the IPO route remains relevant for scaled, well-prepared assets as market condition stabilizes and investor confidence improves.” 

Looking ahead, cash flow and profitability will remain central to exit outcomes. At the same time, governance is increasingly becoming a key factor in exit assessments, particularly for trade sales and IPOs. Sponsors that strengthen these areas early will be better positioned when exit conditions improve. 

Exit Momentum Improves as Deal Volume Recovers; Fundraising Momentum Builds

For exits, SEA recorded 33 deals generating US$4.4b in realized proceeds in 2025, with an 18% increase yoy in volume. General partners (GPs) have held assets for longer and the increase in exit momentum, which we expect to further accelerate in 2026, will get the capital cycle flowing faster. GPs have been focusing on operational and strategic improvements to drive returns and ensure exit readiness.  

Pais adds:

“The SEA PE landscape is characterized by a focus on resilience amid global economic uncertainty. The market is transitioning to value creation-led PE, with sponsors prioritizing more control, operational improvement and exit readiness.”

In terms of fundraising, SEA remains a strategically important allocation market in Asia-Pacific, accounting for 14% of Asia-Pacific PE fundraising. SEA recorded 10 PE fund closes in 2025, raising a cumulative US$4.6b, up 97% yoy.

Alternative Credit Emerges as Key Financing Pillar

In 2026, SEA’s private credit market is set for growth, driven by sustained demand from mid-market corporates and financial sponsors amid tighter bank lending conditions. Solid domestic demand and continued digital economy expansion are creating lending opportunities across sectors including digital infrastructure, real estate-intensive businesses such as healthcare and education, FinTech and renewable energy. Borrowers are increasingly comfortable to pay a premium in exchange for a customized transaction with lighter covenants. Rising allocations from local pension funds and insurers, alongside growing cross-border interest in unitranche, mezzanine and structured credit, are supporting market depth. Ongoing regulatory reforms and improvements in credit infrastructure are expected to further reduce information asymmetries and support the scaling of private credit strategies across the region. 

Pais concludes:

“Differentiated value across private credit can be generated through bespoke financing structures, strategic partnerships with regional sponsors and digital underwriting tools that improve credit assessment. Overall, private credit in SEA offers compelling diversification benefits with attractive spreads above traditional fixed income, particularly for tranches addressing under-served segments of the capital stack.” 

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