19 November 2015

A New Era for Chinese Capital


I think that after 20 years of outbound investment by Chinese investors we are entering a new era for Chinese capital, and we should be prepared for it.

We have seen the deals and cross-border transactions getting bigger and bigger and there has certainly been a much more broader investment expanding out of the previous energy & resources investments. There are some really interesting things happening.

The Australian economy is very sophisticated, the financial industry and the funds, the pension management service are all very advanced as well.

For hospitals and healthcare service providers, we have seen many Chinese bidders competing for the Swiss assets, and this is where we are seeing the main interest.

I have also seen interest from Australian companies saying “can we partner with Chinese investors in some form…”. There is definitely a place for Australian investors to do that because, as indicated in a lot of transactions that I have been working on this year, you often see consortium arrangements and acquisition finance playing a role.

So, when you come to setting up a consortium arrangement, the typical structure for Chinese industry players partnering is, let’s say, a sovereign fund, other industry players, and a private equity fund to do the acquisitions globally. So, for many Australian investors it is about finding their place in that consortium.

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A Guide to Doing Business in China

We explore the key issues being considered by clients looking to unlock investment opportunities in the People’s Republic of China.

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