China is among ‘most active’ markets for mergers, Deutsche Bank top banker says

Name: Two sessions: How China's environmental policies are giving a boost to green industries
Uploaded: 2021-03-08T03:00:09.000Z
Duration: 3 min 26 s
Description: Two sessions: How China's environmental policies are giving a boost to green industries

Transaction sizes are smaller, but the number of deals has picked up significantly compared with start of 2020, according to Deutsche Bank’s Mayooran Elalingam

Chinese companies are focusing on regional, local outbound targets

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Shanghai’s financial district. Another trend that could play an important role in deals in the region this year is the proliferation of SPACs. Photo: EPA-EFE

Chad Bray

Published: 11:00am, 8 Mar 2021Updated: 11:00am, 8 Mar 2021

Just over a year into the coronavirus pandemic, China has become one of the “most active” markets for mergers and acquisitions (M&A), as mainland buyers scoop up deals in Asia and buy local operations from multinational companies seeking to exit the region, according to one of Deutsche Bank’s top bankers in the region.

Activity is probably the “busiest” it has been in a number of years to begin 2021, in terms of the number of deals in the region, even as the sizes of transactions are a little smaller, according to Mayooran Elalingam, Deutsche Bank’s Asia-Pacific head of investment banking coverage and advisory.

“Even if the rest of the year is much more normal, we should have a very, very good year in M&A, probably the best in awhile,” Elalingam said. “We had a good year at the end of 2020 for announcements. That will carry through.”

Domestically, there were 825 deals in China worth a combined US$75.7 billion through March 5, the biggest number of transactions since 2018, according to data from Refinitiv.

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Two sessions: How China's environmental policies are giving a boost to green industries

There were 51 announced outbound deals by Chinese buyers worth a combined US$5.8 billion to begin the year, compared with 79 outbound transactions worth a combined US$1.6 billion in the same period in 2020, according to Refinitiv.