China M&A back on upwards trajectory amid favourable market conditions
M&As on the mainland rose 45 per cent in the first half to US$171.5 billion, with 29 deals valued at more than US$1 billion, according to PwC
Mergers and acquisitions (M&A) activity in mainland China is likely to see high double-digit growth this year amid ongoing consolidation and multinational companies reshaping their portfolios in the world’s second-largest economy, according to PwC.
Several positive changes, including reforms in state-owned enterprises, the rise of Chinese AI start-up DeepSeek’s spillover effect on the economy and stock market rallies, supported the upwards trajectory, according to the consultancy.
“There is confidence returning to the market, as investors are willing to invest larger amounts of capital in M&A,” said Thomas Crasti, PwC Hong Kong M&A advisory partner, in a briefing on Monday. “That confidence is really shining through in the domestic M&A activity.”
In the first half of this year, the value of M&A transactions on the mainland rose 45 per cent year on year to US$171.5 billion, according to PwC. However, the tally was far lower than the peak levels seen between 2016 and 2021, when at least US$250 billion of deals were recorded during the same period in each of those years.
There were 29 mega deals valued at more than US$1 billion compared with 17 and 19 in the first half of 2024 and 2023, respectively. Hi-tech, healthcare and industrial sectors dominated domestic M&A activity.