Chinese M&A To Recover, But FDI Could Lag

Despite a series of high profile overseas commodities acquisitions by Chinese firms, M&A activity in China has taken a significant blow in 2009 to date, with total H109 deal value down 13% y-o-y from US$123bn in H208 to US$107bn. However, new research from consultancy PriceWaterhouseCooper (PWC)'s underlines CFW's views that the worst might be over, with encouraging signs that domestic and outbound M&A are on the way up. Q109 saw a 27% y-o-y fall in M&A volume fell to the lowest level for two years, the result of a fall in both domestic-domestic deals and a fall in inbound FDI from foreign investors. Given this, the 13% overall drop for the first half actually suggests a recovery in the second quarter. That said, CFW cautions that the scope for a major uptick of inward investment remains less clear.

To read the full article, please choose one of the following options: