find the latest legal job
Senior Associate - Litigation & Dispute Resolution
Category: Litigation and Dispute Resolution | Location: Melbourne CBD & Inner Suburbs Melbourne VIC
· Come work for a firm ranked in Lawyers Weekly Top 25 Attraction Firms
View details
Associate - Workplace Relations & Safety
Category: Industrial Relations and Employment Law | Location: Brisbane CBD & Inner Suburbs Brisbane QLD
· Employer of choice · Strong team culture
View details
Freelance Lawyers
Category: Banking and Finance Law | Location: All Perth WA
· Freelance opportunities through Vario from Pinsent Masons
View details
Freelance Lawyers
Category: Other | Location: All Adelaide SA
· • Qualified lawyer with a strong academic background
View details
Freelance Lawyers
Category: Other | Location: All Melbourne VIC
· • Qualified lawyer with a strong academic background
View details
Chinese dealmakers shift focus

Chinese dealmakers shift focus

China’s growing influence in the Australian M&A market shows little sign of slowing down and could be about to shift its focus, according to a Squire Sanders report.

The global firm released its China Outbound M&A Trends 2012 report last week, which documented the dramatic rise of China as a global investor over the past 18 months.

The report showed that while the energy and resources sector remained the dominant force for Chinese companies looking to invest in Australia - 30 per cent of deal volume and 70 per cent of deal value - there had been a noticeable shift towards agribusiness.

“The focus at the moment remains on the energy and resources sector,” John Poulsen, managing partner of Squire Sanders’ Perth office, told Lawyers Weekly. “However, there has been a shift from both Chinese and Japanese investors recently; we’re seeing an increased interest in agribusiness. It has gone a little under the radar but there certainly has been a shift.” 

Poulsen believes that Australian agribusiness will benefit from a diversified food demand in China, which has one fifth of the world's population but only eight-and-a-half per cent of the world's arable land and six-and-a-half per cent of its water reserves. 

“You can break agribusiness down into so many different sectors, it has many different elements, and as a result I think there will be a lot of mistakes made in deals,” he said.

In commenting on the report, Pouslen said he was quite bullish about the current state of M&A in Australia.

“Although we’re in a bit of a lull at moment, we had a meeting with the ASX on a matter recently and they told us that they’ve never been as busy,” he said.  “When we asked what they were busy on, they told us there is a lot of stuff happening in respect to restructuring companies with new participants, but not so much on takeovers.”

Poulsen added that he expects M&A activity to increase in the coming months, particularly given the recent deflation in commodity prices, something he thinks Chinese companies could take advantage of.

“I actually think activity is going to increase, particularly when you see the situation with Fortescue and other iron ore players … because of the current low iron ore price people who are taking a longer-term view on commodity prices might well start investing.

“China is taking a much longer-term look at things and they have increased their level of sophistication in doing deals,” he added.

The report showed that, on an individual country basis, Australia was the top outbound market for volume of transactions since 2011, with 32 deals worth $10.4 billion.

 “For Australian companies, it’s about getting used to working with Chinese ownership. It’s really about a sort of mutual learning,” said Poulsen.

“We have a Chinese state-owned enterprise as clients since 2009, and it’s really interesting to see their increased level of understanding of corporate governance. They’re learning really quickly.”

Like this story? Read more:

QLS condemns actions of disgraced lawyer as ‘stain on the profession’

NSW proposes big justice reforms to target risk of reoffending

The legal budget breakdown 2017

Chinese dealmakers shift focus
lawyersweekly logo
Promoted content
Recommended by Spike Native Network
more from lawyers weekly
microphone
Oct 20 2017
Podcast: One of law’s most infamous alumni – in conversation with Julian Morrow
In this episode of The Lawyers Weekly Show, Melissa Coade is joined by The Chaser’s Julian Morrow....
protest
Oct 20 2017
High Court overturns ‘excessive’ anti-protest legislation
Bob Brown’s recent victory in the High Court over the Tasmanian government was a win for fundament...
Blocked
Oct 20 2017
Changes to Australian citizenship laws blocked
Attempts to beef up the requirements to obtain Australian citizenship were thwarted this week, after...
APPOINTMENTS
Allens managing partner Richard Spurio, image courtesy Allens' website
Jun 21 2017
Promo season at Allens
A group of lawyers at Allens have received promotions across its PNG and Australian offices. ...
May 11 2017
Partner exits for in-house role
A Victorian lawyer has left the partnership of a national firm to start a new gig with state governm...
Esteban Gomez
May 11 2017
National firm recruits ‘major asset’
A national law firm has announced it has appointed a new corporate partner who brings over 15 years'...
opinion
Nicole Rich
May 16 2017
Access to justice for young transgender Australians
Reform is looming for the process that young transgender Australians and their families must current...
Geoff Roberson
May 11 2017
The lighter side of the law: when law and comedy collide
On the face of it, there doesn’t seem to be much that is amusing about the law, writes Geoff Rober...
Help
May 10 2017
Advocate’s immunity – without fear or without favour but not both
On 29 March 2017, the High Court handed down its decision in David Kendirjian v Eugene Lepore & ...