Private equity-backed M&A in Asia has surged 41 per cent so far in 2011 to its highest level since the buyout boom in 2007, boosted by sizeable fund exits, as overseas buyers look for entries into the region's higher growth markets.

Total volume of $25.4 billion is the highest for the first nine months of the year since the $28.7 billion in PE-backed acquisitions in 2007, according to Thomson Reuters data.

Among deals driving that volume are Nestle's offer to buy 60 per cent of Chinese candies and pastries group Hsu Fu Chi International, backed by Baring Private Equity Asia, for about $1.7 billion to expand in one of the world's biggest consumer markets.

Blackstone Group sold its 66 per cent stake in India's Intelenet Global Services, with British outsourcing group Serco buying the firm for up to 385 million pounds ($591 million).

The investment traffic is not all one-way, and private equity is working its way through a $70 billion pool of dry powder, or unused capital for deals, with India and China neck and neck on volume, and 39 per cent of the overall market.

India has edged ahead, with $4.9 billion from 105 private equity-backed M&A deals, while China has $4.8 billion from 96 deals.

And as market disruption closes capital market exit routes, buyout funds are scouting for entry investments in the months ahead.

"It's easier for us to talk to management about changing their business now, than when things are really great, when they wouldn't listen to you," said X.D. Yang, managing director and co-head of Carlyle Asia Partners, speaking on a panel at the SuperReturn conference in Hong Kong earlier this week.

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