Chinese still circling...

This year has thrown up plenty of surprises. Politics aside, it's the global M&A boom led by Chinese buyers that was quite unexpected. There had always been plenty of banker talk about China-backed bids of western companies but I don't think many commentators would have predicted this year's huge surge in dealmaking by Chinese businesses.

But recent reports suggest the China M&A boom could be about to end, with Chinese regulators taking a sterner attitude towards outbound M&A, especially multi-billion pound takeover deals. Indeed, a couple of weeks ago the Financial Times wrote:

Well, from what I hear there are still plenty of Chinese companies participating in western company auction processes and strategic reviews. Take, for example, the £150 million sale of Leisure Pass, the tourist pass company.

Last week private equity firm Primary Capital sold Leisure Pass to rival Exponent (owner of Big Bus Tours) but from what I'm told by good sources Chinese outfits including Ctrip (which recently bought Skyscanner for £1.4 billion), Fosun (owner of a stake in Thomas Cook) and Chinese private equity firm Honey Capital (owner of Pizza Express) all took a look at Leisure Pass during the auction process.

So, I'm expecting just as much Chinese outbound M&A in 2017...


Date: Monday, 19 December 2016, 5:19 pm

[Disclaimer - the information on Betaville does not consitute any form of investment recommendation and is not intended to be relied upon by readers in making, or refraining from, any investment decisions].

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