EQT Asia Chair: "Structural Alpha" Makes Region the Next Private Equity Frontier

What's New

In a recent Alt Goes Mainstream's The DNA podcast series, Jean Salata—Chairperson of EQT Asia and founder of the former Baring Private Equity Asia—argues that Asian private markets offer superior risk-adjusted returns due to market inefficiency, underpenetration, and multi-decade growth tailwinds that developed markets can no longer match.

Why It Matters

As LPs rebalance portfolios away from concentrated US exposure amid geopolitical shifts and valuation concerns, Asia represents the largest untapped opportunity in global private equity—with fund sizes at roughly half their Western counterparts despite housing 50% of world GDP and generating 60% of global growth.

Big Picture Drivers

• Underpenetration: PE transactions represent less than 1% of GDP in Japan versus 2.5-3% in US/Europe, signaling massive runway for expansion

• Generational transition: Post-WWII family businesses entering second and third-generation ownership are increasingly selling to institutional buyers

• Take-private opportunity: Trillions in market cap across Asia's public companies remain candidates for delisting and efficiency improvements

• Domestic capital formation: New savings vehicles like India's SIPs are creating deep local liquidity pools that reduce exit risk

• Technology lag: Even advanced economies like Japan are 10 years behind US cloud adoption, creating visible investment roadmaps

By The Numbers

• $27B: Capital deployed in BPEA Fund 8 including co-investments over 3-4 years

• $13B: Distributions generated in first five months of 2025—a record exit year

• 37 years: Salata's tenure building private equity in Asia since arriving in Hong Kong in 1989

• $5T: Size of Indian stock market, now larger than UK's

Memorable Quotes

• On outsider advantage: "I always felt like I was a little bit on the outside looking in...I was sort of attuned to that thinking there's a gap here."

• On structural alpha: "We're delivering very similar returns to what our colleagues in the US and Europe do, but we're doing it without the public market beta."

• On leadership: "The difference between confidence and certainty is that element of 'I think it's right, we're gonna try very hard to do this, but it may not be right.'"

• On motivation: "Most people are motivated by being part of something larger than themselves, including myself."

• On humility: "Probably the biggest learning—humility of realizing that you don't know as much as you think you know."

Key Trends to Watch

• Corporate carve-outs from Asian conglomerates will accelerate as companies shed non-core assets and focus portfolios

• Global buyout firms entering Asia will create robust secondary market liquidity and sponsor-to-sponsor deal flow

• Shareholder activism in Japan and Korea is just beginning, mirroring Western patterns from two decades ago

• Mid-market growth strategies will capture Asia's highest-growth companies before they scale to large-cap targets

The Wrap

Salata's 37-year Asia journey offers a blueprint for institutional investors: the region's structural inefficiencies, combined with EQT's Wallenberg heritage of long-term family business partnerships, create differentiated access to returns that Western markets—crowded with capital and compressed for alpha—simply cannot replicate.