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Mainland sees drop in finance M&As
By Feng Jianmin |
00:00 UTC+8 September 27, 2011
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Print Edition
Print Edition
MERGERS and acquisitions in China's financial sector have fallen due to the faltering global economic recovery, which may provide opportunities for Chinese companies to buy out branches of European firms, PricewaterhouseCoopers said in a report yesterday in Shanghai.
The value of financial M&As on Chinese mainland tumbled nearly 30 percent in the first half of this year from the same period a year earlier, while the value of such transactions in Asia rose annually, PwC said, without giving specific figures.
Nelson Lou, transactions partner of PwC China, attributed the decline in M&A transactions on the mainland to the absence of large deals.
"Market tumbles have resulted in a liquidity shortage for financial institutions, and this may impact large scale M&A projects in the short term," he said.
"But some companies, especially those from Europe, may need to sell some of their assets to acquire additional capital. This will sustain M&A activities," Lou added.
More than 75 percent of financial institutions on the Chinese mainland are considering M&As in the next 12 months, according to the report.
"As we enter a new period of volatility, there are signs that some (companies) may be tempted to enter the fray and pick up inexpensive but strategic assets," said Matthew Philllips, leader of financial services M&A at PwC China.
The value of financial M&As on Chinese mainland tumbled nearly 30 percent in the first half of this year from the same period a year earlier, while the value of such transactions in Asia rose annually, PwC said, without giving specific figures.
Nelson Lou, transactions partner of PwC China, attributed the decline in M&A transactions on the mainland to the absence of large deals.
"Market tumbles have resulted in a liquidity shortage for financial institutions, and this may impact large scale M&A projects in the short term," he said.
"But some companies, especially those from Europe, may need to sell some of their assets to acquire additional capital. This will sustain M&A activities," Lou added.
More than 75 percent of financial institutions on the Chinese mainland are considering M&As in the next 12 months, according to the report.
"As we enter a new period of volatility, there are signs that some (companies) may be tempted to enter the fray and pick up inexpensive but strategic assets," said Matthew Philllips, leader of financial services M&A at PwC China.
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