Large take-overs of foreign entities by Chinese companies has been going on since 2015 and is escalating drastically much like was seen by Japan in the 1980's before their market bubble popped.
With the inevitable degrading of the Chinese currency by the gov't any companies that can ( ie those with massive cash on hand ) are acquiring outside investments at an alarming rate in an effort to protect their wealth.
"Synergy" of mergers no longer applies here. They have no interest in what the acquired company does - it is just a vessel to hold wealth.
"Big Money gets on China's Lifeboats" is also a very informative read, found in Bloomberg. A trillion dollars left China last year in overseas investments and 2016 is already far outpacing that. Offers at 50-200 % above value are normal, even into the 10's of billions of dollars, General Electric Appliances, hotel chains, cruise ship lines are all being gobbled up in attempts to get the money out of the country while they still can ( and while it is still worth something ).
What happens in 1-3 years time , when the Chinese market bubble explodes and, like Japan, investors lose everything ( due to debt ratios ) - that is what the real unknown is for the future of this game.
18-Mar-2016 15:16:34
- Last edited on
18-Mar-2016 15:17:40
by
Marcusorion2