Chinese Outbound Activity to Increase in 2016 After $1 Trillion Asian Deal Spree in 2015

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By Jacob Maslow

The Asia-Pacific annual deal reached $1 trillion for the first time in 2015. Chinese firms are expected to buy assets abroad in 2016 following the slumping domestic growth in China. Asia-Pacific M&A reached $1.2 trillion in 2015, up 46% from 2014.

Fosun International Ltd., a private company, spent over $102 billion in overseas acquisitions in 2015, according to the most recent data.

Bankers and analysts also state that due to China’s slumping economy, many businesses will need to increase their technology and improve manufacturing in an attempt to bolster economic growth. China is currently on the move, and it is expected that the country will have a very busy beginning of 2016 as a result.

Global investment banks in Asia include: Goldman Sachs (GS) (who increased their market share by 16.7%), HSBC Holdings (HSBA), and Morgan Stanley (MS) (who also increased their market share in 2015).

The most active markets include Hong Kong, China and Australia. State-owned enterprises in China were less active overall in 2015, but Beijing did make major deals in niche areas. Tsinghua Unigroup Ltd. a state-backed company, announced that it plans to invest over $47 billion over the next five years in chip making technologies. The company will try to attempt to take over the market share from Intel Corp. (NASDAQ:INTC) and QUALCOMM (NASDAQ:QCOM).

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