Voice from China
Quarterly update on the M&A market in China
An optimistic start to 2021 sees vaccine rollouts, leadership shifts and hope that international tensions will ease. The Chinese government’s strict disease measures have ensured numbers of new COVID-19 cases remain steadily under control. Despite the pandemic’s initial impact, China achieved positive growth in 2020 — the only country among the world’s largest 15 economies to do so — and GDP looks set to surge this year. Angela Chen from our Shanghai office reviews last year’s M&A activity and provides an on-the-ground forecast of what the new year holds in store.
We look at inbound M&A deals to see what’s driving international investors to opt for China and examine outbound trends, which show signs of an upward tick — probably due to the government’s China Standards 2035 incentives to promote 5G, artificial intelligence and the Internet of Things — and spot opportunities unaffected by foreign direct investment policy restrictions.
Visual breakdowns of inbound and outbound deals by industry, region and transaction values give you an at-a-glance overview of recent M&A activity. In addition we spotlight the highly fragmented facility management industry, also known in China as property management. Continuing urbanization and an increasing demand for high-quality facility management services, especially during the pandemic, mean regional providers looking to achieve economies of scale have begun to consolidate. We map out the facilities management landscape and explain objectives, strategies and typical targets, providing two examples from Oaklins HFG China’s dealbook: Project Dragon, CITIC Capital Partner’s acquisition of Dussmann China; and Project Property, a leading property management company’s acquisition of GSN.
In addition, we list 30 outbound acquisitions by Chinese companies closed between July and December 2020.
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For more expert commentary on the M&A market in China, download the PDF below