M&As on Chinese mainland and HK take slightly bigger share of deals in Asia-Pacific in first 3 quarters

Mergers and acquisitions on the Chinese mainland and Hong Kong managed to take up a slightly bigger share of activities in the overall  Asia Pacific market in the first three quarters of 2017, although the value and number of M&As both dipped from the same period last year.

The market share of Chinese mainland and Hong Kong M&A deals in the Asia Pacific inched up to 42.9 percent in January to September from 42.8 percent in the same period of 2016 by number, according to a Mergermarket report. The value of the M&As took up over half of the whole deal value in Asia-Pacific, the report added.

However, the mainland and Hong Kong saw 1,228 M&A deals worth US$258.9 billion in the first three quarters of the year, or a 12.7 percent drop in value while the number of deals fell by 52 respectively from the same period last year, the report said.

Domestic transactions continued to drive M&A activities in China as they took up US$238.9 billion or 92.3 percent of the total value. That translated to a rise of 14.5 percent in value and 35 deals in number from 2016. 

The industry and chemical sector remained the most targeted on the mainland and Hong Kong both by value and number of deals, representing a 8.5 percent rise in value from the same period last year. Some mega deals included the acquisition of Dalian Shipbuilding Industry for US$3.3 billion by a Chinese consortium led by China Cinda Asset Management, and JPMF Guangdong’s US$3 billion takeover of Lingyi Technology, the report said.

In terms of outbound acquisitions, the mainland and Hong Kong recorded US$110.9 billion spread over 298 deals in the first three quarters.

"Although the value fell by 35.1 percent year on year, both the value and deal number still ranked as the second highest for the first three quarters on Mergermarket record," said Neal Zhang, senior research analyst, and Yinan Lyu, research relationship manager of Mergermarket APAC.

Transport M&As ranked as the top outbound acquisitions by value at US$34.4 billion in the mainland and Hong Kong. The value, spread over 14 deals, accounted for 20.3 times the value from the same period of 2016, with notable M&A deals being the US$16 billion investment in Global Logistics Properties, and the acquisition of LogiCor Europe for US$13.8 billion.