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China Invested $18b in US in H1

China Invested $18b in US in H1China Invested $18b in US in H1

Chinese companies invested $18.4 billion in the US in the first half of this year, more than triple the amount invested in the first half of 2015, according to Rhodium Group.

To compare, Chinese companies invested $6.4 billion during the same period a year ago and $15.3 billion in all of 2015, the report said, Forbes reported.

The increase was largely driven by private sector acquisitions–there were more than 55 completed deals—in services, technology and consumer-oriented assets as well as greenfield projects in real estate and manufacturing, the report said.

Though some are interpreting the recent surge in outbound FDI from China as capital flight in response to uncertainty about exchange rates as well as gloomy economic and political outlook in China, “more than 80% of all Chinese FDI transactions in the US in the first half of 2015 can be characterized as strategic investments,” analysts Thilo Hanemann and Cassie Gao wrote in the report.

The largest Chinese acquisition so far this year was Haier’s $5.6 billion acquisition of General Electric’s appliance division. The acquisition closed in June. In January, Dalian Wanda agreed to acquire Legendary Entertainment for $3.5 billion. Omnivision Technologies was acquired by a consortium of Chinese private equity firms including CITIC Capital Holdings, Hua Capital Management and Goldstone Investment Co. for $1.9 billion earlier this year. In February, Ningbo Joyson Electric Corp. bought Key Safety Systems, an air-bag maker, for $920 million.

There are currently $23 billion in pending mergers & acquisitions, Rhodium Group said. Among those deals are Chinese aviation and shipping conglomerate HNA Group’s $6 billion bid for tech firm Ingram Micro. Also Anbang Insurance Group’s $6.5 billion bid to acquire Strategic Hotels.

 

Financialtribune.com