South Asia's software M&A market just shifted into overdrive. India recorded 135 tech deals in the first half of 2025—nearly matching the entire 2024 total and on pace to shatter the 2022 record. Disclosed deal value hit $1.7 billion in H1 2025 alone, already surpassing full-year 2024.
This isn't a temporary spike. Broader APAC tech M&A deal values surged 44% in Q1 2025 compared to the prior year. India and Japan have supplanted China as the regional M&A powerhouses, driven by economic expansion, rapid digitization, and a maturing tech ecosystem.
If you're building or investing in profitable software companies in South Asia, understanding who's buying, what they're targeting, and how deals are structured is suddenly non-optional. Here's what's actually happening on the ground.
The buyer landscape splits into two camps with very different motivations.
Strategic acquirers are corporations buying software assets for competitive advantage—absorbing technology, acquiring talent, or entering new markets. Recent examples illustrate the pattern:
Accenture acquired TalentSprint (India) for its specialized AI/ML talent pool. Amazon paid over $150M for Axio (India), a buy-now-pay-later fintech, to push into Indian financial services. Infosys bought The Missing Link (Australia) to expand its cybersecurity offerings globally. Netgear acquired Exium (India) to integrate advanced SASE (Secure Access Service Edge) solutions into its networking products.
The theme is clear: global majors are leveraging South Asia's deep tech talent for capability acquisitions, while domestic champions are consolidating at home and expanding abroad.
Private equity firms are the dominant force, driven by massive dry powder and the need to generate returns through operational improvements and scale. The scale is staggering:
New Mountain Capital's ~$10.2B Fund VI acquired Access Healthcare for $2B—a massive tech-enabled services provider with U.S. clients and Indian delivery. Everstone Capital's ~$1.7B Fund IV invested ~$200M in Wingify, targeting high-growth profitable Indian SaaS with globally competitive products. ChrysCapital's ~$2.1B Fund IX bought ProHance, kicking off a strategy to build a portfolio of Indian SaaS champions starting with workforce management software.
These aren't passive financial investors. PE firms are actively building "enterprise SaaS consolidation platforms"—acquiring a foundational platform company, then rolling up smaller specialized businesses to create category leaders.
The entry threshold for PE is lower than most founders assume. Proprietary data shows that 60% of PE firms will consider targets with less than $10M in revenue, and 78% will look at deals with under $3M in EBITDA.
Strategic acquirers prioritize different metrics: ARR growth exceeding 35%, churn under 5%, and Net Dollar Retention above 110%. They're buying momentum, not just profitability.
But the real story is vertical-specific demand where acquirers are hunting for defensible moats:
Healthcare IT (EMR). India's Electronic Medical Records market is growing from $790M in 2025 to $1.13B by 2030, supercharged by government mandates like the Ayushman Bharat Digital Health Mission. Acquirers want SaaS-based EMRs with deep specialization (oncology, cardiology), proven interoperability, integrated AI for clinical decision support, and penetration in Tier-II/III cities.
FinTech Infrastructure. India's FinTech market is doubling from $44B in 2025 to $95B by 2030. The next wave isn't payments—it's infrastructure. Buyers are targeting companies that leverage AI for credit underwriting using the Account Aggregator framework, embedded finance platforms, and InsurTech solutions.
Niche Enterprise SaaS. B2B SaaS with clear product-market fit in high-demand areas like cybersecurity (Exium acquisition), data analytics, or workforce management (ProHance acquisition) are prime targets. The high capital efficiency of Indian SaaS firms—often achieving hypergrowth with burn multiples below 1x—makes them exceptionally appealing.
Management retention is critical. Acquirers use earnouts and equity rollovers to keep founders and key executives aligned post-acquisition. However, Indian regulations cap earnouts at 25% of total consideration, deferred for no more than 18 months, which forces more certainty into upfront valuations.
The valuation landscape presents a compelling arbitrage opportunity. While direct multiples for private South Asian companies remain opaque, a clear framework exists:
Global public SaaS companies trade at 6-7x EV/ARR post-2022 correction. Private M&A globally averages around 7x with a control premium. Top-performing private SaaS demonstrating "Rule of 40" (growth rate + profit margin >40%) command 10-11x. Elite, category-defining companies with strong moats hit 18-22x.
Publicly listed Asian software companies trade at a ~5x median (10-year average), often including lower-margin services/hardware that create a discount to pure-play SaaS. Mid-market cybersecurity M&A—a consolidation hotbed—clears at 8-10x.
The arbitrage for global acquirers is obvious: efficient South Asian assets trading at a discount to Western comparables, combined with capital efficiency that allows hypergrowth with minimal burn.
Cross-border structuring is critical for optimizing tax outcomes and managing risk.
Most deals are routed through offshore holding companies in Singapore or Mauritius to leverage Double Taxation Avoidance Agreements (DTAAs). The choice between asset purchase and share purchase is material—asset deals in India can attract Goods and Services Tax (GST). Currency volatility in the Indian Rupee introduces FX risk that must be hedged.
Earnouts remain capped at 25% of consideration and 18 months maximum deferral in India. This regulatory constraint forces more upfront valuation certainty compared to Western deals where earnouts can stretch 3-5 years.
The most sophisticated buyers are executing roll-up strategies—acquiring a foundational platform, then adding specialized "bolt-on" companies to build market-leading suites.
Take the Healthcare EMR roll-up sequence: First, acquire a foundational EMR with a strong customer base to establish market footprint. Second, add smaller EMRs in niche fields (cardiology, podiatry) for vertical depth and TAM expansion. Third, bolt on telehealth, patient engagement, or analytics tools for high-value integrated features. Finally, unify branding, cross-train sales teams, and streamline the product suite to achieve operational synergies.
This playbook prioritizes interoperability through standardized APIs and focuses on critical patient care workflows to create a unified user experience.
Similar consolidation opportunities exist in FinTech Infrastructure (API platforms, Account Aggregator analytics, embedded finance), Manufacturing & Supply-Chain Software (cloud ERPs, supply chain visibility, AI-driven quality management), and Professional & Workforce SaaS (legal, accounting, project management tools with cross-selling potential).
Success demands mastering South Asia's complex regulatory environment.
Press Note 3 (2020) is the biggest hurdle. It mandates prior government approval for FDI from countries sharing a land border with India—primarily targeting Chinese capital. With a beneficial ownership threshold often linked to a 10% stake, this adds 12-14 weeks to deal timelines.
CCI approval from the Competition Commission of India is required for deals over INR 20 billion (~$240M), with a target approval period of 150 days. The cumulative effect pushed average deal closing times to 220 days by 2022.
Data privacy laws add complexity. Sri Lanka's Personal Data Protection Act (PDPA) and India's Digital Personal Data Protection (DPDP) Act create diligence obligations around data handling and localization that can kill deals if compliance gaps surface.
India allows 100% FDI in software under the "automatic route," but navigating the patchwork of regulations requires local legal and tax expertise.
The investment thesis for South Asian software M&A between 2025-2027 is anchored in three powerful catalysts:
Market maturation. The Indian SaaS market is projected to reach $50B in ARR by 2030. The number of early-stage companies surpassing $10M in revenue has more than tripled in the last six years, creating a deep pool of acquisition-ready targets.
Capital availability. PE investments in Indian enterprise SaaS surged 66% in the first seven months of 2025. Major players like KKR, Blackstone, and Everstone are actively deploying capital.
Regulatory tailwinds. Government initiatives like "Make in India," liberalized FDI policies, and foundational digital platforms like UPI are accelerating digitization. A September 2024 rule change streamlined exits by mandating direct RBI approval (bypassing the lengthier NCLT process), signaling government intent to facilitate investment.
But this window has risks. Currency volatility, regulatory ambiguity (especially around Press Note 3 and beneficial ownership), cultural mismatches in post-acquisition integration, and increasing competition from global capital entering the market all threaten returns.
Two bold predictions: PE holding periods for profitable SaaS assets will shrink from 5-7 years to under 4 years as secondary buyout markets mature. And the next wave of consolidation will be dominated by vertical-specific AI companies (AI for legal contract review, AI for medical diagnostics) rather than horizontal SaaS platforms.
South Asia's software M&A market is in a rare high-growth phase, driven by India's explosive digital economy. A diverse buyer pool—global strategics like Accenture, Indian giants like Infosys, and financial sponsors like New Mountain Capital and ChrysCapital—are aggressively deploying capital.
Valuations are robust, with a clear arbitrage opportunity for investors who can identify high-performing assets. Consolidation is the dominant strategy, with massive roll-up potential in fragmented verticals like healthcare IT, fintech, manufacturing software, and workforce SaaS.
The 2025-2027 outlook remains bullish, but success demands more than capital. It requires mastering India's intricate FDI rules, tax structuring, and approval timelines. For those with deep local intelligence and strategic patience, South Asia offers one of the most compelling growth stories in global software today.
