The rapidly deteriorating trade and investment relationship between
Washington and Beijing is sending a further chill through Chinese
dealmakers who have already seen the number of Chinese acquisitions of
American assets take a big hit.
So far this year, Chinese companies have spent just $1.6 billion on U.S. assets, down almost 80 per cent from the year-earlier period, according to Thomson Reuters data. By contrast the amount China has spent on European assets has risen 39 per cent from last year to $45.1 billion.
“We are now focusing on Europe-bound deals and having U.S. deals on hold. The trade war between China and U.S., if not short-term, will be a mid-term thing and will take some time to conclude,” said Lin Feng, founder and CEO of Chinese investment and advisory firm DealGlobe.
“Opportunities in the U.S. will be more small investments, or joint ventures in China. It will definitely hurt significant minority stake acquisitions, but on the other hand it may help targets in Europe and Israel,” he added.
In 2016, which stands as the record for Chinese cross-border dealmaking, China acquired U.S assets worth $62.6 billion and spent $88.4 billion on European assets.
Since then, China’s imposition of capital controls and in particular a regulatory crackdown on some of its most acquisitive companies, such as HNA Group [HNAIRC.UL], Dalian Wanda Group Co and Anbang Insurance Group [ANBANG.UL], have badly dented Chinese investment flows heading for American shores.
So far this year, Chinese companies have spent just $1.6 billion on U.S. assets, down almost 80 per cent from the year-earlier period, according to Thomson Reuters data. By contrast the amount China has spent on European assets has risen 39 per cent from last year to $45.1 billion.
“We are now focusing on Europe-bound deals and having U.S. deals on hold. The trade war between China and U.S., if not short-term, will be a mid-term thing and will take some time to conclude,” said Lin Feng, founder and CEO of Chinese investment and advisory firm DealGlobe.
“Opportunities in the U.S. will be more small investments, or joint ventures in China. It will definitely hurt significant minority stake acquisitions, but on the other hand it may help targets in Europe and Israel,” he added.
In 2016, which stands as the record for Chinese cross-border dealmaking, China acquired U.S assets worth $62.6 billion and spent $88.4 billion on European assets.
Since then, China’s imposition of capital controls and in particular a regulatory crackdown on some of its most acquisitive companies, such as HNA Group [HNAIRC.UL], Dalian Wanda Group Co and Anbang Insurance Group [ANBANG.UL], have badly dented Chinese investment flows heading for American shores.
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