Chinese outbound investment hit another record high in 2016, rising to $200 billion globally. Nearly half of this investment targeted assets in North America and Europe, a reflection of China’s shift from commodity to technology and services sector acquisitions as it transitions to a middle-income economy.
In 2016, Chinese direct investment nearly tripled in North America and doubled in Europe, reaching a combined value of $94.2 billion in both regions, up 130% from $41 billion in 2015. Before 2008, both regions received less than $1 billion in Chinese investment per year.
Although the total number of completed deals in both regions remained consistent with previous years at 330 transactions (155 in North America and 175 in Europe), the average deal value more than doubled to $290 million, up from $120 million in 2015, as Chinese investors pursued more medium and large-sized deals.
Well over half of all Chinese direct investment into North America and Europe since 2000 has taken place in the last three years, marking the continued influence of globalization and the rapid development of China’s economy.
Michael DeFranco, Global Head of M&A at Baker McKenzie