The Strategy Behind China's Investments in European Companies

Christian Saxenhammer provides, in a guest article for Das Investment, deep insights in the investment behavior of Chinese investors.

Das Investment / 2019.07.30

The investment policy of Chinese companies has undergone a paradigm shift. On the one hand, the lull in investments is politically desired. Investments are to be made sustainably and wisely. The negative experiences of the past also play an important role – a number of less well-thought-out investments have proven to be negative deals. On the other hand, this phase must be seen as a snapshot. The country is pursuing a clear industrial policy strategy (China 2025) that is geared to the changing social and socio-economic factors within the region. The strategic component in M&A is growing strongly. Investors are paying more attention to economic indicators such as earnings, cash flow strength and the technological future prospects of the respective companies. The focus is primarily on the strategic fit with the core business. The investment strategies are based on the analysis of concrete development paths, which are supported by acquisitions.

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