American Invest Hub
  • Politics
  • Investing
  • Business
  • Latest News

American Invest Hub

  • Politics
  • Investing
  • Business
  • Latest News
Business

Trump’s tariff threats could drive a wave of Chinese outbound M&A

by admin November 25, 2024
November 25, 2024
Trump’s tariff threats could drive a wave of Chinese outbound M&A

China’s outbound mergers and acquisitions (M&A) activity could see a significant uptick as US President-elect Donald Trump’s proposed tariffs push mainland firms to accelerate their globalization strategies.

Experts suggest that fears of tariffs ranging from 60% to 100% on Chinese goods are driving businesses to seek alternatives to mitigate reliance on the US market, according to a report by South China Morning Post.

“More tariffs may mean the globalization of Chinese companies is going to get faster,” said Stanley Lah, Asia-Pacific and China M&A services leader at Deloitte.

“Chinese companies will consider moving faster to look for alternatives in shipping or selling to the US.”

Outbound M&A beats greenfield investments

Chinese companies are increasingly turning to outbound M&A as a quicker way to achieve global market efficiency, compared to greenfield investments like setting up factories or offices abroad.

Despite a frail global M&A environment, Chinese firms see this route as vital.

According to London Stock Exchange Group data, outbound M&A deals by Chinese companies fell 16.5% to $17 billion this year but are showing signs of rebounding in strategic sectors.

Last year, outbound M&A rose 59% year on year to $27 billion, though still far below the $202 billion peak of 2016.

Sectors with Beijing’s blessings drive deal-making

Certain sectors—such as technology, manufacturing, and new energy—are benefiting from government backing, which could sustain the momentum in outbound M&A.

Federico Bazzoni, CEO of investment banking at Vantage Capital Markets, highlighted these areas as prime targets for Chinese dealmakers.

For instance, Tencent Holdings recently acquired Cyprus-based game maker Easybrain for $1.2 billion, and Midea Group bought the climate division of Swiss firm Arbonia for $811 million earlier this year.

“Valuations are coming down, and we’re seeing some activity return,” Bazzoni said.

However, mega deals akin to ChemChina’s $43 billion Syngenta acquisition in 2017 remain rare due to regulatory uncertainties.

Regulatory and geopolitical hurdles dampen mega deals

Geopolitical tensions and complex regulatory approvals continue to weigh on the M&A landscape.

“Geopolitical sentiment is sensitive, and deals are complicated, pushing down the headline deals in recent years,” Deloitte’s Lah said.

Despite these challenges, there is cautious optimism for a rebound in 2025.

“State-owned enterprises and corporates are waiting to see what happens with domestic and US policies before engaging with new targets,” Bazzoni added.

Inbound M&A dims under Trump’s shadow

While outbound activity shows potential, the picture for inbound M&A in China remains bleak.

Trump’s likely intensification of restrictions on Chinese access to advanced technologies such as AI and semiconductors has discouraged US investors from entering the Chinese market.

Although Beijing has reassured foreign investors of its openness, long-term capital remains hesitant.

“Investors are looking to confirm that the country’s efforts to support economic development are sustainable,” said Lah.

The post Trump’s tariff threats could drive a wave of Chinese outbound M&A appeared first on Invezz

0
FacebookTwitterGoogle +Pinterest
previous post
Archer Aviation stock to form a rare positive pattern: what next?
next post
Canoo stock forms rare pattern: could GOEV surge 670%?

Related Posts

DJT stock: Trump Media’s dilution and bankruptcy risks...

October 15, 2024

Apple stock under pressure: Will AI glasses make...

May 23, 2025

IAG share price is firing on all cylinders:...

December 12, 2024

Toncoin (TON) slumps as Elon Musk denies Telegram-xAI...

May 30, 2025

SWARMS price prediction: Swarms to release a no-code...

March 19, 2025

OpenAI announces a search engine called SearchGPT; Alphabet...

July 27, 2024

IAG share price has surged: will it fly...

January 14, 2025

India’s Sensex tumbles 1,000 points as bears dominate;...

November 28, 2024

Can Palantir challenge big tech’s dominance?

October 9, 2024

Asian markets open: positive start for Nikkei; Sensex...

June 16, 2025

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest News

    • GMS stock jumps 29% on takeover interest from Home Depot, QXO, analysts raise PTs

      June 22, 2025
    • Japan’s rice price surge: what’s driving it and why it could spark a political crisis

      June 22, 2025
    • BofA raises STOXX 600 target amid resilient global growth, warns on Mideast risks

      June 22, 2025
    • Palantir co-founder: US must prevent Iranian nukes

      June 22, 2025
    • Fed governor Waller advocates for July rate cut amid tariff, labor market outlook

      June 21, 2025

    Categories

    • Business (3,199)
    • Investing (2,531)
    • Latest News (2,000)
    • Politics (1,530)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: americaninvesthub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 americaninvesthub.com | All Rights Reserved