ChemChina signed a $7.9bn deal with Pirelli
Overall, state-owned and private businesses invested an unprecedented $23bn in Europe — including Norway and Switzerland as well as the EU — in 2015 while investing $15bn in the US, according to a report by Baker & McKenzie, a law firm, and Rhodium Group, a consultancy.
However, the figures suggest that the pace of Chinese investment in western economies may be slowing.
New investment in Europe was up 28 per cent on the $18bn registered in 2014, a smaller increase than 2014’s doubling of the 2013 figure. Investment in the US was up 17 per cent compared to 2014’s level of $12.8bn.
Concerns about China’s economy have dragged down global financial markets, affecting prospects for the eurozone and many others. Such worries are one reason why the European Central Bank is expected on Thursday to unleash a new round of economic stimulus.
Meanwhile, figures such as Wang Jianlin, China’s richest man, have raised concerns about Chinese state-owned enterprises’ investments in Europe, arguing that they lack international management standards.
But Michael DeFranco, chair of Baker & McKenzie’s M&A practice, hailed the Chinese group’s investment in developed economies.
“These are turbulent economic times and yet we see Chinese companies acting with confidence and continuing to make major moves in Europe and North America,” he said.
Chinese investment in western economies is back on track to break the record again in 2016: during the first six weeks this year Chinese groups announced $70bn in potential deals, although the number is highly provisional and not all such acquisitions will be completed.
Chinese direct investment in the eurozone was up 37 per cent in 2015, rising to $17.1bn from $12.5bn.
Italy, one of the eurozone’s weaker economies, received the most investment of any EU nation from Chinese companies. That was largely down to a $7.9bn deal between Pirelli and ChemChina. France was the number two country, receiving $3.6bn of investment through a string of big deals in the tourism and infrastructure sectors.
In the US, New York, California and Texas received the most investment. Chinese companies invested $5.4bn in New York, the top beneficiary, with most of the money spent on three big financial services and property deals.
Financial Times
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