6 December, 2015
While inbound investment into China is likely to remain steady in the coming year, in 2016 there will be a surge in Chinese insurers moving into or strengthening their positions in overseas markets around the world – particularly in more mature markets.
Following the lifting of restrictions on the yuan being used for foreign investment, a number of Chinese firms – most notably Fosun and Anbang – have been actively seeking the acquisition of overseas insurance assets over the past 12 months, in a trend that is set to accelerate in the coming year.
As well as a demonstration of financial muscle and the ambition to become genuinely global players, acquisitions have been driven by the desire for access to low-cost insurance funds in the world's low-interest markets and establish funding vehicles to help deliver on overseas investment strategies. Chinese companies are also keen to resolve any potential governance issues that may arise from operating as a global organisation by acquiring the expertise needed to navigate the international capital markets.
With Chinese investors generally taking a long-term view, they can be prepared to pay a small premium for the right investment with the expectation of holding their stake over a relatively long term and generating healthy returns over a ten to 15 year period.
For further information, please contact:
Michael Crips, Partner, Clyde & Co
michael.cripps@clydeco.com
