Business / Economy

$1.1 billion fund being created to help German, Chinese M&As

By WANG YING (China Daily) Updated: 2015-10-30 07:53

Two leading business associations from China and Germany have agreed to establish a fund with an initial capital of 1 billion euros ($1.11 billion) to better serve merger and acquisition activity between the two nations.

China Mergers & Acquisitions Association and German Federal M&A Association said they plan to establish an cooperative base in Northeast China, most likely in one of the region's equipment manufacturing industrial parks.

Cooperation offices will also be opened in Beijing and Munich, which are expected to provide companies with services including risk evaluation, identifying potential business partners, financing and legal assistance.

The new investment cooperation will be aimed at supporting the two countries' key future economic policies: "Made in China 2025", and the German Industry 4.0, Liaoning Daily reported.

The fund will focus on supporting M&A deals particularly in the intelligent equipment, consumer products, medical care and financial services sectors.

Kai Lucks, president of German Federal M&A Association, said there are there are a number of German medical treatment and health firms already interested in working with the planned Sino-German equipment park in Shenyang.

Lucks was talking during an event organized in Shenyang, the provincial capital and largest city of Liaoning province-the second stop in a nine-day trip to China by a visiting group of German entrepreneurs, which also takes in Taicang in Jiangsu province, Beijing and Tianjin.

He said he believes the two countries will continue to build closer economic connections, given the growing number of Germany small and medium-sized firms already investing in China.

"Many Chinese enterprises are very interested in our technology. In Germany we have more than 1 million companies, many of which are technology leaders worldwide," he said.

Winfried Bostelmann, chairman of BVMW China, the China division of the German Association for Small and Medium-sized Businesses, said increasing numbers of German companies are becoming interested in China.

The most recent figures show about 80 percent of German companies have less than 10 employees, and only about 1 percent hires more than 500.

Bostelmann said connecting German's creativity, strong innovation, planning and quality management, together with Chinese flexibility, big thinking and marketing advantages, could be a potent mix of skills.

German Chancellor Angela Merkel started an official visit to China on Thursday.

Statistics from China's Ministry of Commerce show last year bilateral trade between China and Germany was worth a record 153.8 billion euros, a 8.8 percent rise on the previous year.

According to data from Germany Trade and Invest, China's direct investment in Germany has increased significantly over the last decade. Germany has become the top destination for Chinese greenfield investments, for instance.

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