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Location:Home > Economic and Trade Info > Bilateral Economy and Trade
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| China's monthly outbound M&A deals return to growth in Feb |
Although China's M&A market contracted in January 2010, the total number of China's monthly outbound M&A deals did not fall but rather increased in February. Analysts say that the traditional industries will become the focus of China's M&A market in 2010 because the development of such industries is already relatively mature.
It is worth noting that with the rise in the number of China's outbound M&As in February, the M&A value increased significantly to 759 million U.S. dollars, up 110.6 percent month-on-month. Meanwhile, 5 of the 6 M&A deals in February came from the traditional industries. Of them, Wuhan Iron & Steel Company paid 400 million U.S. dollars for a 21.5 percent stake in Brazil's MMX Mineracao e Metalicos SA (MMX), becoming MMX's second largest shareholder and securing about 600 million tons of resources. This is the largest M&A deal in terms of value since the start of 2010.
Wang Jiaqi, a researcher at Zero2IPO Research Center, said the increase in the number of outbound M&A deals indicates that following the upturn of the world economy, the rally in asset prices has caused foreign enterprises to be more willing to sell assets. The "go abroad" strategy, the implementation of which is accelerating, will promote domestic enterprises to engage in outbound M&A deals.
The earlier over-hyped proposed acquisition of General Motor's Hummer brand by Sichuan Tengzhong Heavy Industrial Machinery eventually failed. Analysts said that the Chinese government has issued subsidy policies to encourage automobile enterprises to produce environmentally-friendly vehicles, while the Hummer deal is against the trend of the current policies. The failure of the deal also implies a macro trend that China's industries will adhere to the energy-conservation and environmentally-friendly development strategy. |
Source:By People's Daily Online |
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