Mergers and Acquisitions

When a PRC industrial company purchased a European chemicals producer, it utilised an advanced acquisition strategy that included a complex debt restructuring. It also had to convince Chinese regulators the strategy was workable

Acquirers allowed to select their own offer exemption clause in case of a coincidence of clauses.

Calculation of percentages relating to the purchase or sale of the identical or related assets by listed companies for a continuous period of 12 months clarified.

Time of completion of an acquisition to increase shareholding clarified.

Mofcom lifts the examination and approval requirement for certain foreign investment matters.

CSRC gives a definition of a seriously distressed company.

Mofcom may terminate M&A transactions that affect national security.

The Provisions detail the security review application procedure for acquisition of domestic enterprises by foreign investors.

The State Council recently promulgated a new initiative to establish a security review system on domestic M&A activities conducted by foreign parties. This new process officialises an attempt to safeguard key Chinese companies, but will add time and cost burdens to select potential overseas investors