Overseas investment and M & A report of Chinese capital in 2022 From It orange

The following is the Overseas investment and M & A report of Chinese capital in 2022 From It orange recommended by recordtrend.com. And this article belongs to the classification: Venture capital, Investment & Economy, research report.

According to the statistics of it orange, Chinese capital investment abroad began in 2004, and so far there have been 2738 Chinese capital investment transactions abroad. From 2004 to 2010, there were only a few overseas investment events participated by Chinese capital every year, and they are in the embryonic stage. After nearly five years of development, the frequency of Chinese capital investment abroad has gradually increased. From 2015 to 2021, the number of overseas investment events of Chinese capital showed a trend of growth in the first half of the period, and began to decline in 2019. In 2020, affected by the global epidemic, the decline was more serious; In 2021, the number of overseas investment events participated by domestic capital reached 454, the highest in history.

In terms of investment amount, we estimate that the annual amount spent by Chinese capital entities on overseas investment reached a peak in 2017, about 96billion yuan, about 1/10 of the total amount of domestic capital investment and financing in the domestic primary market. In 2020, Tencent Music Entertainment Group decided to invest in UMG with a strategic investment of 3billion euros. The occurrence of this huge financing event has increased the annual investment, making its investment reach 82.592 billion yuan with fewer investment events. At the beginning of 2022, Chinese capital has set out. In two months, it has made more than 40 overseas investments of 5billion yuan. It is expected that the overseas investment situation will continue to improve this year.

Globally, the overseas investment footprint of China’s investment covers North America, South America, Europe, Asia and other continents. However, there are still large gaps in this territory, especially in Africa. However, over the past decade, the top priority of domestic capital in overseas investment is still the United States, and a large number of capital are competing to invest in this “fertile land”.

From the doughnut chart, we can more intuitively feel that in a large number of overseas investment events of Chinese capital, the entire North American region accounts for 55%, most of which are invested in the United States. In other words, nearly half of Chinese capital’s overseas investment is invested in the United States, which shows that in the overseas market, North America was and is the first choice for most Chinese capital investment.

The Asian market is the second choice for Chinese capital. The investment events of Chinese capital in the whole Asia (except China) account for 30% of the global investment events of Chinese capital; Among them, India (11%), Singapore (7%) and Israel (3%) are the most prominent countries.

In the European market, the investment events of Chinese capital in Europe accounted for 12% of the global investment events of Chinese capital; Among them, Britain is the most prominent. As for Oceania, Africa and South America, the proportion of Chinese capital investment in its global events is only about 1%.

In terms of the number and proportion of overseas investment of Chinese capital in the continent, Chinese capital has invested in 21 countries in Europe, which is the continent with the largest number of countries and the highest proportion of investment; European countries in which Chinese capital has invested account for about half of the total number of European countries. This also indirectly reflects the relatively balanced development of European countries.

The investment footprint of Chinese capital in Asia involves 15 countries, accounting for about 1/3 of the total number of Asian countries. It is the continent with the second largest number of Chinese capital investment countries.

Although there are many countries in Africa, due to remoteness, underdevelopment and other reasons, China’s capital is involved in only four countries, with the smallest proportion of investment, less than 1/10.

Compared with other continents, the number of countries in North America, South America and Oceania is relatively small. China has invested in 3, 2 and 2 countries respectively.

From the perspective of industry distribution, the industry in which Chinese capital has been involved most in overseas equity investment is health care, with 449 investment events; The second is the blockchain industry, with 347 investment events. Chinese capital has invested in 322 overseas financial industries. The industries in which Chinese capital is popular in overseas equity financing also include enterprise services, e-commerce retail, intelligent hardware, automobile transportation and entertainment media. There are 286, 212, 191, 144 and 112 investment events in these five industries respectively, all exceeding 100.

The investment in the major industries such as games, education, advanced manufacturing, logistics, local life and social logistics is relatively small, and the overall investment events are about 50~100. Sports, real estate services, traditional manufacturing and agriculture are the least Chinese capital has set foot in overseas. As a new concept, meta universe has few related companies and financing events.

The number of countries in which Chinese capital is involved in different overseas industries is also different, although the number of medical and health investment events is the largest; However, the most widely involved industry in the world is the financial industry, with a total of 35 overseas countries. This reflects the fact that Chinese capital has a high concentration of investment in overseas medical and health industries; The financial industry is the opposite. The main reason behind this is that the financial industry has high universality and small differences in the world, and many overseas countries have less restrictions on foreign investment in finance and are more inclusive. Therefore, Chinese capital can invest in a relatively undifferentiated way in the world.

Secondly, in the blockchain industry, Chinese capital has set foot in 26 overseas countries. Blockchain is highly consistent with the financial industry, and both are tools and technical means at the bottom of the economic society. For example, Chinese capital has more financial and blockchain projects in the US and Singapore markets.

The industries that Chinese capital has deployed to more than 20 overseas countries also include health care, e-commerce retail, enterprise services, and automobile transportation. These industries are also overseas industries that Chinese capital is keen to invest in, with an average investment of more than 200.

China has less than 100 capital investments, but there are games in industries with more than 15 overseas countries. Chinese capital has invested in the game industry in 19 countries on five continents. Among them, the countries with a large amount of investment include the United States, South Korea, Britain and Japan. The game industry is a relatively mature Internet industry, regardless of national boundaries, with strong universality; Chinese capital led by Tencent also prefers to invest in game projects, so it has a wide investment layout in the world.

The number of Chinese capital investments is less than 70, but the industries with more than 10 overseas countries are tourism, education, logistics and local life sports. These industries are characterized by strong localization and need to be widely distributed.

According to it orange data, we can clearly observe that among overseas investments with Chinese capital participation, the proportion of events invested by one Chinese investor alone has shown an obvious downward trend, from 33% in 2016 to 16% in 2021; The proportion of events jointly invested by two capital companies also decreased from 21.6% in 2016 to 8.8% in 2021. On the other hand, the number of events jointly invested by more than 6 investors increased from 22 in 2016 to 188 in 2021, an increase of 8 times; The proportion increased from 7% in 2016 to 41% in 2021.

This shows that Chinese capital is becoming more and more skilled in joint investment with other overseas institutions, rather than “fighting alone”.

From the perspective of industry changes in the layout of overseas investment of Chinese capital, from 2016 to 2020, health care has been the industry with the largest overseas investment of Chinese capital. However, in 2021, there was a major reversal of the situation. Chinese capital’s investment in blockchain was enthusiastic, and the number of relevant investment events reached 123, completely surpassing the investment events in the medical industry. Chinese capital’s investment in blockchain has a growing trend in 2018, reaching a historical peak in 2021. The main reason is that the current blockchain business model has poor “compliance” in China, and the domestic blockchain companies represented by Qian’an have begun to invest overseas; Meanwhile, emerging domestic investment institutions will be headquartered in Hong Kong and invest heavily in overseas blockchain projects.

The distribution of Chinese capital to overseas financial and enterprise service industries has not changed significantly in quantity, but has shown a trend of increasing and decreasing in the distribution of overseas e-commerce retail industry and intelligent hardware industry. Specifically, in 2016 and 2017, the investment of Chinese capital in intelligent hardware was much larger than that of e-commerce retail industry. In 2018, the two were the same. By 2019, the investment in e-commerce retail gradually surpassed that of intelligent hardware, and the gap between the two was further widened in 2021.

The preference of Chinese capital for investment in American innovative enterprises has been the highest in the past six years. Although the amount of investment fluctuates, the position of “No. 1” remains unchanged. From 2016 to 2020, Chinese capital’s investment in India ranked second in the list. However, in 2021, Chinese capital’s investment in India decreased significantly, while its investment in Singapore increased significantly. Chinese capital’s investment in India has decreased significantly, mainly affected by the latest policies.

On April 17, 2020, the Indian government issued an official notice on Revising the foreign investment policy to curb foreign investment in speculative acquisitions of Indian companies due to the impact of the COVID-19. The revised policy requires that all investments (entities and natural persons) from countries bordering on India’s land border (including China) must realize investment in India through the government route. If the beneficial owner of the investment is located in the above-mentioned countries, such investments are also subject to this restrictive provision; Previously, such restrictions only applied to Pakistan and Bangladesh.

The increase of Chinese capital’s investment in Singapore is related to the development of local block chain, meta universe and other emerging industries. Since 2017, China and Singapore have signed the memorandum of understanding on jointly promoting the construction of the “the Belt and Road”. The two countries have closer cooperation in trade exchanges, investment and other economic activities, which has opened a convenient channel for Chinese capital to accelerate investment in the Singapore market.

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