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2014 Greater China outbound M&A spotlight
The 2014 edition of Deloitte's China outbound M&A report has arrived and survey results show that investors continue to have positive expectations for the year ahead. Although it may be premature to conclude at this point in time that 2014 would yet be another record-breaking year for Chinese outbound investments, the number of completed transactions in the first five months of the year clearly indicates a strong trend for the year
Chinese investments in Germany
Germany represents a highly attractive market for Chinese investors that have looked for technological best practices, advanced management experience and talent for China's domestic market and that pursuit has been the main motive for Chinese buyers coming to Germany. Germany does not compete by the overall volume of Chinese companies in the country with other major developed markets such as the United States and United Kingdom but Germany attracts Chinese investors in specialized deals that are more technology-driven.
Both number of deals and value of Chinese M&A transactions in Germany in the first five months of 2014 already showed an increase compared with that of 2013.
German mid-sized family-run businesses, which are often global leaders in a niche-market, are the right targets Chinese companies would look at. Mittelstand is part of the industrial process, having know-how and industrial best practices. In cooperation with a Chinese company, the venture would create a "win-win" to get the German company to the Chinese market. Chinese investors are not looking at large companies but to this kind of family-run businesses with know-how and technology, experiences and of a smaller scale, with turnover between US$100 million-500 million. Generally, technology acquired by acquisitions and expansions would be done by greenfield investment, according to Dirk Hällmayr, Partner and Chinese Services Group leader in Germany.