Saturday, November 23, 2013

China will become Asia's leader in outbound investments

China is set to become Asia's leader in outbound corporate acquisitions this year, ending Japan's two-year leadership. So far this year, Chinese companies have launched $56.2 billion of overseas M&As, led by Shuanghui International Holdings' $7.1 billion purchase of Smithfield Foods Inc.  
The energy and power sectors still dominate China's outbound investments in value terms, though their share of overall M&As has fallen to 44.1% from 52.3% five years ago. By contrast, the proportion of M&A in the financial sector has risen by two-thirds to 14.4%.
Next year, China's biggest companies are expected to continue the trend of performing numerous M&A deals beyond natural resources and into areas such as food and banking. This outbound investment will allow them to access new sources of revenue growth and to more easily globalize their brands.

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