Chinese companies’ cross-border M&A rising

Chinese companies’ cross-border M&A rising

A vendor holds Chinese Yuan notes at a market in Beijing in this August 12, 2015 file photo.   REUTERS/Jason Lee/Files

BEIJING – Chinese companies have seen steady growth in cross-border mergers andacquisitions while expanding overseas, according to statistics issued by the Ministry ofCommerce on Friday.

From 2008 to 2011, Chinese companies’ outward foreign direct investment in the form ofM&As totalled $106.3 billion, representing an annualized growth of 44 percent, Chen Runyun,an official from the MOC’s department of outward investment and economic cooperation, saidat a news briefing in Beijing.

In 2011 alone, OFDI in the form of M&As amounted to $27.2 billion, accounting for 37 percentof the total OFDI that year, Chen said.

Mining, manufacturing and power generation are among the most favored sectors for Chineseinvestors, according to Chen.

In a recent case, the China National Offshore Oil Corporation was given approval by theCanadian government earlier this month to buy Calgary-based oil and gas producer NexenInc. for $15.1 billion.

Once completed, the takeover will be China’s largest overseas acquisition.

Despite robust activity overseas, Chen said Chinese companies’ overseas investment, whichaccounts for just 2 percent of the global flow, has encountered a string of obstacles, includinga lack of operation experience, weak risk controls and frequent safety accidents.

Chen said the ministry will work to improve policy support to facilitate Chinese companies’overseas expansion.

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Chinese companies’ cross-border M&A rising

A vendor holds Chinese Yuan notes at a market in Beijing in this August 12, 2015 file photo.   REUTERS/Jason Lee/Files

BEIJING – Chinese companies have seen steady growth in cross-border mergers andacquisitions while expanding overseas, according to statistics issued by the Ministry ofCommerce on Friday.

From 2008 to 2011, Chinese companies’ outward foreign direct investment in the form ofM&As totalled $106.3 billion, representing an annualized growth of 44 percent, Chen Runyun,an official from the MOC’s department of outward investment and economic cooperation, saidat a news briefing in Beijing.

In 2011 alone, OFDI in the form of M&As amounted to $27.2 billion, accounting for 37 percentof the total OFDI that year, Chen said.

Mining, manufacturing and power generation are among the most favored sectors for Chineseinvestors, according to Chen.

In a recent case, the China National Offshore Oil Corporation was given approval by theCanadian government earlier this month to buy Calgary-based oil and gas producer NexenInc. for $15.1 billion.

Once completed, the takeover will be China’s largest overseas acquisition.

Despite robust activity overseas, Chen said Chinese companies’ overseas investment, whichaccounts for just 2 percent of the global flow, has encountered a string of obstacles, includinga lack of operation experience, weak risk controls and frequent safety accidents.

Chen said the ministry will work to improve policy support to facilitate Chinese companies’overseas expansion.

Leave a Comment

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