In 2025, Japanese companies carried out 10 cross‑border M&A transactions in the machinery sector across the Asia–Pacific region. Activity centred on Taiwan, India, and China, and reflected structural themes characteristic of the machinery industry: optimisation of production footprints, reorganisation of after‑sales and service networks, and strategic responses to labour-saving and automation requirements. These transactions demonstrated how Japanese manufacturers are reshaping operating models in response to evolving market structures across APAC.
Taiwan: Strengthening Lifecycle Business Through Local Subsidiary Integration
In Taiwan, ShinMaywa Industries deepened its presence by converting a Taiwanese mechanical parking‑equipment manufacturer into a consolidated subsidiary through its local entity. Demand for mechanical parking systems remains resilient across urbanising and densely populated Asian markets, and the acquisition reflects a desire to establish a complete lifecycle business—from installation to maintenance and replacement—within the region.
Taiwan’s manufacturing supply chain remains relatively stable and sophisticated, increasing its importance for Japanese machinery and precision‑component producers both as a production platform and as a distribution hub.
India: Consolidation of Sales Companies to Accelerate Market Penetration
Shimadzu Corporation advanced a significant restructuring in India by integrating two sales companies handling analytical instruments and medical devices. India’s expanding industrial base and strengthening medical‑infrastructure investment have created sustained demand for measurement and diagnostics equipment. The consolidation enhances commercial efficiency, strengthens sales governance, and accelerates market penetration by unifying customer coverage.
In the machinery sector, after‑sales and service networks are often critical to investment returns, and this move represents a typical approach where sales and maintenance platforms are integrated to improve lifecycle revenue and customer retention.
China: Parallel Movements of Consolidation, Divestment, and Selective Expansion
China recorded the largest number of machinery‑related transactions with three distinct cases—merger, divestiture, and acquisition—illustrating varied strategic responses to rapidly evolving market conditions.
Azbil integrated two local subsidiaries operating in energy‑efficiency support and measurement instrumentation, aiming to streamline governance, improve operational productivity, and eliminate organisational overlap.
Kato Works divested its Chinese subsidiary engaged in hydraulic excavator manufacturing, reflecting accelerating commoditisation in the construction‑machinery market, intensifying price competition, and the rising dominance of local manufacturers.
Nidec expanded its position in the HVAC and energy‑efficiency domain through the acquisition of a Chinese scroll‑compressor manufacturer, reinforcing its capabilities in high‑efficiency equipment and solutions.
These cases show three differentiated strategies—withdrawal, consolidation, and selective investment—that capture the increasingly polarised market structure in China, where demand remains large but differentiation is increasingly difficult without technological leadership.
Other ASEAN Markets: Complementary Realignment of Production and Sales Structures
Though smaller in scale, activity was also observed in other ASEAN markets such as Vietnam and Malaysia. Transactions captured process‑level optimisation, including divestitures of packaging or backend functions in Vietnam, and adjustments to equipment‑sales or operational footprints in Malaysia.
For the machinery sector, production‑base optimisation remains a recurring theme, as companies pursue risk diversification away from China. This has led to complementary allocation of manufacturing processes into Vietnam, India, and Malaysia, aligning cost structures with operational needs while maintaining supply‑chain resilience.
Sector-Level Dynamics: Structural Themes in APAC Machinery M&A (2025)
Four key structural trends characterised Japanese corporate activity in 2025:
1. Reconfiguration of Production and Sales Networks
China saw a mix of consolidation, exit, and targeted acquisition; India focused on commercial integration; and Taiwan supported expansion through local subsidiary‑led acquisitions. Machinery players must continually optimise fixed assets, equipment utilisation, and service networks, making reorganisation an ongoing necessity.
2. Expansion of Service Businesses and Lifecycle Value Capture
Areas such as parking systems, analytical instruments, and medical equipment rely heavily on installation, maintenance, and replacement cycles. Strengthening after‑sales capability and improving lifecycle value (LTV) remain central to investment decisions.
3. Intensifying “Selection and Concentration” in China
Commoditised segments such as construction machinery saw exits, whereas high‑efficiency equipment and precision components attracted further investment. Corporate restructurings—including subsidiary mergers—highlighted efforts to raise productivity and rebuild competitiveness.
4. Continued Diversification into ASEAN for Process Distribution
Efforts to mitigate China‑centric supply‑chain risks accelerated, with Vietnam, India, and Malaysia gaining prominence as complementary production and distribution nodes.
Notable Transactions
- ShinMaywa Industries (Taiwan): Acquired a mechanical parking‑system manufacturer through its local subsidiary.
- Shimadzu Corporation (India): Integrated two Indian sales companies, strengthening commercial coverage.
- Kato Works (China): Divested its Chinese construction‑machinery subsidiary amid intensifying competition.
- Nidec (China): Acquired a scroll‑compressor manufacturer to enhance HVAC and energy‑efficient equipment.
- Azbil (China): Merged two local subsidiaries to improve productivity and governance.
Related Links
[Full Report] APAC Cross-Border M&A Review 2025–2026: The Definitive Edition (All Sectors & Regions)