Chinese deal making in Europe surges

Chinese investors are doing a far higher value and volume of M&A deals in Europe than European investors in China, according to data from Deloitte. In 2014 Chinese companies and financial investors announced 79 deals in Europe, compared to 54 European deals in China.

In terms of value, in 2014 the average disclosed deal size for Chinese investors in Europe was £249 million (€332 million). This compared with £116 million (€155 million) for European investors in China. At the top end the difference is even more pronounced, with the five largest deals done by Chinese investors in Europe having total value of £6.6 billion (€8.8 billion), whereas the five largest deals done by European investors in China had total value of only £1.4 billion (€1.86 billion).

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Graham Matthews, lead China M&A Partner for Deloitte, commented: “In the space of a few years the tectonic plates between Europe and China have shifted, with Chinese deal activity surging in 2014. No European company or private equity fund has ever done a deal larger than £1 billion (€1.13 billion) in China, but last year alone there were five Chinese acquisitions in Europe of around this size.

“The shift in the balance has profound consequences for deal makers. Any seller of assets in Europe should be actively thinking about how to attract and include Chinese buyers in their sales processes.”