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Report: China M&A deals in US slump to $6.1B in H1

M&A activity by Chinese companies in the U.S. dropped to $6.1 billion worth of deals in the first half of 2017 from $27.5 billion in the same period in 2016, a joint report from White & Case and and M&A data provider Mergermarket showed July 31.

China was the ninth-biggest M&A investor in the U.S. in the first half of 2017, a fall from its ranking as the third-biggest M&A investor in the same period in 2016.

The sharp decrease in investments was attributed to concerns about national security in the U.S. and President Donald Trump's "America First" policy, which prompted rigorous scrutiny of investments from China and other countries seen to have trade ties with countries hostile to the U.S., said Christopher Kelly, White & Case's Asia-based partner.

China, for its part, imposed tighter scrutiny on deals worth more than $2 billion as part of efforts to restrict capital outflow against a weakening yuan.

Two trends are emerging from these controls, said Kelly, as reported by the South China Morning Post on Aug. 6.

One is "greater emphasis" from Chinese investors on countries in Europe, such as Germany. The other, he said, is the "return of financial sponsors and strategic investors from Western markets seeking better opportunities [when there are fewer bidders from China]."