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BIZCHINA / Center
Officials reassure foreign investors on M&As
(Xinhua)
Updated: 2007-08-02 11:25
The MOC issued a regulation to ask foreign investors to apply for
approvals from the MOC "if their purchases of domestic companies affect
national economic security, take place in key sectors or cause a transfer
of the operating rights of famous domestic brands". Previously, only
mergers and acquisitions worth more than 100 million U.S. dollars needed
MOC checks and approvals.
Related readings:
?M&As face security scrutiny
?Foreigners shy of Chinese M&As
?Economy fuels M&As in China
?Foreign investment grows in support of new enterprises
The government had enhanced supervision over foreign M&As in such sectors
as power supply, power grid construction, the national defence and
military industries, petroleum production and key manufacturing sectors,
said Jin Bosheng, a research analyst with the MOC.
Liao downplayed the negative side of foreign M&As in recent comments, and
said M&As could facilitate foreign investment without the use of land,
which would avoid straining the land supply.
He also stressed that foreign M&As could bring both capital and
technologies that are keenly needed by state-owned enterprises in their
industrial restructuring and upgrade.
Meanwhile, both officials and economists agreed that legislation
governing M&A deals should be established to ward off risks from hostile
mergers and acquisitions.
Long Yongtu, secretary-general of the Bo'ao Forum for Asia, said foreign
mergers and acquisitions were not "great scourges", but supervision of
the process was important.
(For more biz stories, please visit Industry Updates)
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