Lack of mega acquisitions cited The mainland has suffered a spectacular collapse in the value of private equity deals, according to figures released for the first half of the year by Thomson Financial. The total value of deals made by buyout companies to June 30 was US$678.9 million, a decline of more than 83 per cent from the US$4.2 billion for the same period last year. The mainland's share of deals in Asia-Pacific, excluding Japan, fell from 33 per cent to just 3 per cent, placing it well behind India, Taiwan and Singapore. Australia recorded the biggest rise, accounting for more than half of the US$22 billion worth of deals made in the region. The mainland's disappointing performance is set to reignite concerns about protectionism in Asia's second-biggest economy. Beijing has announced plans to make foreign investors buying companies go through national security checks, while Carlyle Group's failure to take a controlling stake in state-owned Xugong Group Construction Machinery last year raised fears of an anti-foreigner backlash. However, analysts said the chief reason for the huge drop in the value of private equity transactions was the absence of any mega-deals to compensate for the record US$3.8 billion acquisition April last year, when a Goldman Sachs-led consortium bought a 10 per cent stake in Industrial and Commercial Bank of China. The acquisition by Goldman Sachs Capital Partners, Allianz and American Express was a one-off investment aimed at building strategic partners in the banking, insurance and credit-card businesses and came just a few months before ICBC's record US$21.9 billion listing in Hong Kong. The number of private equity deals made in the first half of the year rose marginally to 24 from 22 from the same period last year. 'China's private equity companies are already growing extraordinarily quickly,' Fudan University economics professor Shi Zhengfu was quoted as saying in China Business News yesterday. 'Within 10 years, China may become one of the biggest private equity markets in the world, and very possibly the second largest behind the US.' With Britain's private equity market - the world's second-largest after that of the United States - recording US$75 billion in deals in the first half, this appears to be an optimistic assessment. A nagging concern for the mainland government, which increasingly sees private equity growth as an important component of a modern financial system, is that few large private equity deals are made by domestic buyout firms. Only one of the top 10 deals by value last year came from a mainland company, with the rankings dominated by US investors.