Chinese Private Equity Funds Executes Influence Worldwide

The well-known Chinese Private Equity (PE) firm, AGIC Capital, has taken over a 30-year old company in Italy, beating off competitors from Europe and the U.S.

Giuseppe Bellandi, owner of the Italian industrial automation components company Gimatic Srl, said by e-mail, “I was really surprised when I realized how strong the Chinese private equity firms are.”

According to Bloomberg and Asian Venture Capital Journal, China’s PE industry has been undergoing an unprecedented expansion globally. It is said that Chinese PE firms have completed at least $16.4 billion of cross-border deals so far in 2016, higher than Asian deals by foreign PE firms for the first time. Within just a few years, the industry, previously known for “buy-and-flip” investments in local companies, is already primed to go public due to the overseas push.

“There’s a lot of domestic capital available, obviously looking for a home, and that’s fueling the emergence of these funds,” said Michael Thorneman, a partner at Boston-based consulting firm Bain & Co.

Some significant overseas acquisitions conducted by Chinese PE firms include the $3.6 billion takeover of U.S. printer company Lexmark International Inc., the $2.75 billion purchase of Dutch chipmaker NXP Semiconductors NV’s standard products unit and the $600 million acquisition of Oslo-based Opera Software ASA’s web browser business.

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