Chinese takeovers of US companies plunge amid Trump rhetoric

Chinese investments in the United States has sunk by 65 per cent year on year, according to CNBC.
Chinese investments in the United States has sunk by 65 per cent year on year, according to CNBC. PHOTO: AFP

NEW YORK - Chinese investments in the United States has sunk by 65 per cent year on year, CNBC reported on Wednesday (Aug 16), citing figures from financial markets platform Dealogic.

The US financial news channel said the sharp decline comes amid greater uncertainty over whether the Trump administration will allow such deals to be completed.

It said the Dealogic report predicted a further drop in Chinese deals in the US, putting US$75 million (S$102 million) in adviser fees at risk.

In comparison, Chinese outbound mergers and acquisitions targeting the US peaked at US$65.2 billion last year, with high-profile deals such as HNA's purchase of a 25 per cent stake in Hilton Worldwide.

CNBC noted that the pressure to limit Chinese dealmaking in the US is coming from both countries.

The Chinese government has been cracking down on the outflow of capital from the country, money laundering and risky debt by scrutinising some of China's largest dealmakers such as HNA, Wanda Group, Fosun and Anbang.

On the US side, CNBC said reports indicate the Committee on Foreign Investment in the US is looking to use national security concerns to prevent more Chinese purchases of American firms, especially in technology.