Big Chinese Deals Stall on Capital-Outflows Clampdown – By KANE WU and JULIE STEINBERG Jan. 27, 2017 7:24 p.m. ET


Takeover pace slows on stricter policing of money leaving China

An exhibition booth for China National Chemical Corp., also known as ChemChina, at an industry fair in Shanghai, China, in September. Regulatory hurdles have delayed ChemChina’s Syngenta deal. PHOTO: ANDY WONG/ASSOCIATED PRESS

An exhibition booth for China National Chemical Corp., also known as ChemChina, at an industry fair in Shanghai, China, in September. Regulatory hurdles have delayed ChemChina’s Syngenta deal. PHOTO: ANDY WONG/ASSOCIATED PRESS

The pace of big Chinese takeovers abroad is slowing as buyers contend with rules tightening the flow of money out of the country and increased government scrutiny at home and overseas.

Bankers say many of the record-breaking $225 billion in overseas acquisitions Chinese companies announced last year are stalled by financial or regulatory hurdles—including the country’s biggest-ever deal, China National Chemical Corp.’s $43 billion bid for Syngenta AG, a Swiss seed and pesticide maker. European regulators this month extended the deadline for their review of ChemChina’s bid a second time, to April.

More Chinese acquirers are backing out of deals. While Chinese firms announced more than double the amount of overseas acquisitions last year versus the previous, the value of deals withdrawn in 2016 was up around sevenfold, to $38.39 billion, according to Dealogic. The average number of days it took a Chinese buyer to complete an overseas deal in 2016 edged upward throughout the year, with November and December notching the highest levels, at above 140 days, according to Dealogic.

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s