China–North America deal highlights

Outbound acquisitions targeting Canada and the USA are up 81% from the same period last year, reaching US$6.8bn collectively. The energy & resources sector alone accounts for 70% (US$4.8bn) of the activity.

DLA Piper Shanghai-based partner Wan Li says that new government policies have been the push for interest in North America. “The Canadian government has recently become more open to Chinese clients and its resource-rich competitors have also gone through new developments – the Australian government recently imposed new tax regimes for natural resources transactions. These extra costs, I assume, is part of the reason why Chinese companies are shifting their interest into other regions,” said Wan Li, Shanghai-based partner at DLA Piper.

North American firms have benefited from that interest. Canadian firms Blake, Cassels & Graydon and Osler, Hoskin & Harcourt won mandates in the Sinopec-Syncrude deal in April this year – the largest Chinese acquisition of a Canadian company on record. Blake Cassels has had a lengthy history of working with Sinopec, having advised on their first foray into Canada – the Northern Lights Project.

Apart from dominant energy & resources transactions, other industries like automobiles and agriculture are also active in terms of cross-border acquisitions. Sinochem Corp has recently invited Temasek, the Singapore sovereign wealth fund, to join a consortium that may bid for Canada's Potash Corp, the world's largest fertilizer supplier. ALB

Related stories:

• Sinopec relies on in-house team for US$4.65bn acquisition (30 April 2010)
• CIC turns to Canadian firm Torys for Teck investment advice (14 July 2009)
• NA firms called in on Sinopec's largest overseas takeover (30 June 2009)