Corporate shoppers take a breather

Overseas M&A’s coast on the China-led Belt & Road Initiative, but hit bumps in rising valuations, stricter regulations our global footprint and develop a beachhead in Southeast Asia,” said Li Donghui, executive vice-president of Geely.

Guan Qingyou, research director of Minsheng Securities, said, “The Belt and Road Initiative will promote China’s merger and acquisition tide” as companies can decrease deal costs and risks with State financial support. Chen Chao, director of transaction services at PwC China, said, “Cross-border deals with strategic significance, especially industrial upgrading and the Belt and Road-related projects, will dominate the overseas merger and acquisition market this year.”

Given the surge in the number of M&A’s, Chinese authorities moved to step up supervision in December.

The National Development and Reform Commission, the Ministry of Commerce, the People’s Bank of China, and the State Administration of Foreign Exchange declared that they would pay closer attention to overseas investments in hotels, sports clubs, film studios and property.

In January, SAFE released a guideline to tighten review procedures for overseas direct investments.

Meanwhile, Chinese corporate buyers are facing stricter regulatory hurdles and security reviews overseas.

There is another twist in the tale. The volume and value of first-quarter deals dropped 39 percent and 77 percent yearon-year, respectively, from record highs, according to the PwC report.

The report attributed the year-on-year slump in firstquarter M&A’s to the slower pace of going abroad by Stateowned enterprises and private companies. The deal value by financial investors in the first quarter even plunged 91 per-