A Shift in the Relationship of Family Owned Businesses to Chinese Investors

The declining direct investments from Chinese investors is a topic, Christian Saxenhammer commented on, in the Wirtschaftswoche.

WitschaftsWoche / 2019.08.19

Political pressure and restrained economic growth cause direct investments from China in Germany to decline sharply. After years of rapidly growing debt, Beijing has begun to regulate the domestic financial sector more strongly. Neither private nor state-owned companies have access to loans with which they can make costly acquisitions abroad. “The message is clear: clean up your books or live with the consequences,” says a Shanghai investment banker who has advised numerous Chinese companies on acquisitions abroad. Christian Saxenhammer, , Managing Director of Saxenhammer & Co., says: “In the past, the Chinese solved problems by writing a big check”. In the meantime, the money is “not more relaxed”, as there is “financial need”. This is also due to the very risky maneuvers of the Chinese. According to the ifo Institute, which has examined Chinese buying behavior, Chinese investors are characterized by the fact that they often buy companies with above-average debts that rarely make a profit, often suicidal, so to speak kamikaze in Mandarin.

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