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The mystery of the vanishing Chinese investor

Why aren’t firms putting their money where Xi Jinping’s mouth is?


For those eagerly anticipating a flood of Chinese investment into emerging Europe, the last few months have brought good news and bad. 

First the good news. Last year, China became the biggest foreign investor in the region for the first time. According to law firm CMS, Chinese firms announced €7.7 billion of acquisitions in central and eastern Europe over the 12-month period. 

Now the less good news. CEFC China Energy’s purchase of a stake in Russian state oil firm Rosneft accounted for more than 97% of that total. In other words, apart from one big ticket deal, a region covering central Europe, eastern Europe, the Balkans and Turkey attracted just €200 million of M&A flows from China. 

Given the hype around Chinese acquisitions in CEE for the best part of a decade, particularly since the launch of the Belt and Road Initiative (BRI), this number is astonishingly low. So what explains the failure of Chinese firms to put their money where their president’s mouth is?

Bankers report that Chinese bidders regularly turn up in M&A processes across the region. Why then do they rarely stay the course?


An obvious explanation – and the one most commonly proffered by sell-side advisers – is the difficulty of marrying Chinese business practices with western-style M&A.

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