Chinese Love for U.S. Is Smothering American Companies

Chinese firms are ramping their M&A efforts with American stocks, but the interest has reached uncomfortable levels

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Chinese Love for U.S. Is Smothering American Companies

More and More Chinese Interest in the U.S.

Sinopec 185 Chinese Love for U.S. Is Smothering American CompaniesWhile the high-profile purchases of American interests by Chinese companies may get the lion’s share of media attention, the dissenters may want to worry about the sheer number of smaller, less-publicized partial acquisitions that China’s been making in just the past couple of years.

Were you aware that China’s second-largest energy company, Sinopec (SHI), spent $2.2 billion in the middle of last year to acquire one-third of a natural gas joint venture with Chesapeake Energy (CHK)? Sinopec is also a one-third owner of several projects that Devon Energy (DVN) is developing. That’s an awful lot of Chinese involvement in domestic energy supplies.

Whether partial acquisitions or complete buyouts, one thing is clear — Chinese firms are quickly growing their interest in U.S. companies. In 2012, China submitted twenty-three notices of intent to buy American companies. That’s well up from 2011′s total notifications of ten. Last year’s tallies are still being taken, but there’s no disputing that China will be the prevailing suitor of American companies for the second year in a row when 2013′s final score is posted.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities.


Article printed from InvestorPlace Media, http://investorplace.com/2014/01/chinese-love-u-s-companies-become-smothering/.

©2014 InvestorPlace Media, LLC

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