NewRhodium says China’s cross-border M&A falls 13 pct to US$53 billion in 2014
“The major reason for lower total spending last year was a sharp drop in natural resource asset buying," Rhodium said
The total value of China’s cross-border mergers and acquisitions (M&A) dropped 13 per cent to US$53 billion in 2014, which was the first decrease since 2011, according to a report by Rhodium Group, a US consultancy that tracks Chinese overseas deals.
In contrast, global M&A soared 47 per cent to US$3.5 trillion in the same year, according to Thomson Reuters.
“The major reason for lower total spending last year was a sharp drop in natural resource asset buying," Rhodium said.
"Energy and materials deals were a major factor driving Chinese outbound M&A growth over the past decade, with an average of US$30 billion spent each year between 2008 and 2013. In 2014, Chinese spending on extractive industry assets tumbled to just US$19 billion, as an anti-corruption campaign and anticipation of a less resource-intensive growth model dampened firms’ risk appetite,” Rhodium said.
Rhodium’s figures differ from those of China’s Ministry of Commerce and the American Enterprise Institute (AEI), a private US think tank.
Extrapolating from the Commerce Ministry’s figures for the first 11 months of 2014, Chinese outward investment for the whole of 2014 was estimated to have risen 8.6 per cent to US$98 billion, AEI said.
By their own calculations, AEI said 2014 outward investment grew by 0.7 per cent to US$84.4 billion.