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China Moving to Buy Up Troubled Euro Companies

Posted March. 05, 2009 09:24,   


China, which dispatched a large business delegation for purchasing to Europe late last month, will send another investment team consisting primarily of staff from large state-run companies.

The Chinese Securities Journal yesterday quoted Chinese Commerce Minister Chen Deming as saying, “The investment delegation will visit Germany, Switzerland, Spain and Britain, where the purchasing delegation visited earlier. This time the delegation will visit the countries for long-term investment, including acquisition of companies.”

Areas for investment will reportedly include processing and manufacturing as well as machinery and electronics. The investment delegation was formed at Chen`s instruction.

The minister had returned from his European tour with the purchasing delegation.

The investment delegation will likely comprise 40 to 50 companies and is smaller than the purchasing delegation, which had more than 200 members. The amount of its expected investment, however, will likely exceed the 13 billion U.S. dollars the purchasing delegation spent, as the investment delegation represents large state-run companies.

Chinese media said Chen decided to form the investment delegation while visiting Europe after hearing requests from European companies to invest rather than just buy products.

Beijing apparently seeks to kill two birds with one stone, as it can win support by helping troubled European companies and secure advanced technology and management methods by investing in such corporations

"Following the delegation’s tours to four Western European countries, we are also considering sending officials to Northern and Eastern Europe to find investment opportunities," Chen said.

Li Wei, vice chairman of the Assets Supervision and Administration Commission of the State Council, said, “The government will enthusiastically support companies’ overseas investments, including acquisitions of foreign firms.”