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Chinese acquirers spend ten times more on European businesses than vice versa
22 November 2016
Chinese dealmakers have completed 171 acquisitions with a disclosed deal value of $88.4bn across Europe so far this year, according to analysis by Deloitte, the business advisory firm. This massively outdoes the 52 deals and disclosed deal value of $8.2bn achieved by European acquirers into China. Chinese acquisitions have also increased over the longer-term, up 40% on the 122 deals done for all of 2015.
Activity has not been slowed by the Brexit vote, with 11 deals completed in the UK since the referendum, and one about to.
Angus Knowles-Cutler, China Services Group Chairman for Deloitte, commented: “The appetite of Chinese buyers for acquisitions in Europe continues apace and with encouragement from the Beijing government and favourable exchange rates, is likely to increase. Since the referendum, Chinese buyers continue to close deals here and, if anything, the UK looks a more stable bet than many other advanced economies. Any seller of assets should be thinking about how to include Chinese buyers in their sales processes.”
The average disclosed deal value was $0.9bn for Chinese buyers, or $0.35bn without the ChemChina v Sygenta megadeal. This beats the average deal value of $0.28bn for European investors in China. Germany was the most popular destination for Chinese companies by volume with 34 deals, the UK coming second with 32 deals, then France with 21 deals.
Chinese companies look to the UK to acquire in financial services and the leisure industry, in particular hotels and football clubs. Half of the 16 European leisure deals this year took place in the UK.
Angus Knowles-Cutler concluded: “In addition to financial services and leisure, another area to watch is education and training, where Britain is seen as the leading western country. Meanwhile many acquirers are still focusing on bringing the brands and technology back to China, and deals here are now around 10% cheaper.
“Chinese businesses have no problem finding acquisition targets and are now focused on the challenges that arise after signing. This includes managing and motivating western business leaders, and delivering on the promises made.”
Notes to editors
- Data sourced from Mergermarket, with year to date counted as up to 10 November 2016.
- We have counted the ChemChina v Sygenta megadeal as worth $45.9bn.
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.
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The information contained in this press release is correct at the time of going to press.
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