DC Discusses: Perception & reality of Chinese buyers

What's driving Chinese M&A?

China’s market volatility, high levels of debt and economic slowdown are, by now, familiar headlines. In addition, the government is now to limit overseas acquisitions to prevent further declines in the value of the renminbi. Nevertheless, Chinese interest in acquisitions of companies in Europe and the US has increased sharply. While past acquisitions were often undertaken solely to support the government’s plans, recent deals have shown that capital markets and commercial objectives have become more important. The current five-year and 10-year plans are designed to achieve growth and stability within specific areas, such as quality of life goals and the modernisation of China’s manufacturing industry. This article will explore China’s acquisitions of overseas businesses and the role and characteristics of M&A in the market.