CHINA Law and Practice Contributed by: Bing Zhai, Commerce & Finance Law Offices
1. Trends 1.1 M&A Market
On 19 June, the Eight Guidelines for the STAR Market proposed greater support for M&A, encouraging STAR Market-listed companies to conduct upstream and downstream indus - trial chain integrations and acquire high-quality unprofitable “hard-tech” enterprises. From the perspective of market performance, these policy measures have had a significant effect. Wind Information data shows that since the beginning of 2024, the number of restructur - ing events disclosed by all A-share listed com - panies has increased compared to 2023, with a noticeable rise in the activity of listed companies participating in M&A. Companies are also more actively seeking suitable M&A targets based on policy directions, focusing on core businesses, new quality productivity and industrial chain integration. M&A behaviour has become more rational and standardised, gradually shifting from pure scale expansion to emphasising syn - ergies, technological upgrades and other high- quality development goals. 1.3 Key Industries In 2024, the level of activity in M&A varied sig - nificantly across different industries. Technology Sector: A Hotspot for M&A The technology sector emerged as one of the most active areas for M&A. In the semiconduc - tor industry, numerous companies engaged in acquisitions to secure advanced technolo - gies, expand their market share and enhance their global competitiveness. These transac - tions aim to integrate resources and overcome key technological challenges, particularly as domestic demand for semiconductor self-suf - ficiency grows. In the artificial intelligence (AI) sector, companies are also leveraging M&A to strengthen their technological capabilities and accelerate the application of AI across various
In 2024, China’s M&A market showed a nota - ble recovery. According to Wind Information data, the total number of M&A transactions for the year reached 8,378, representing a 5.6% decline compared to 2023. However, the total transaction value increased by 1.6% year-on- year, breaking the downward trend observed over the previous two years. Specifically, the total transaction value rose to CNY2.02 trillion in 2024, marking a 1.6% year- on-year increase. Notably, in the second half of 2024, the M&A market in China reached CNY1.23 trillion, with year-on-year growth of 9%. This upward trend indicates that, despite a decrease in the number of transactions, the average size of M&A deals has increased, reflecting a shift towards larger-scale and higher-quality transac - tions. 1.2 Key Trends In 2024, multiple policies were introduced at the national level to encourage M&A, playing a posi - tive role in guiding market activity and corporate behaviour. In April, the State Council issued Several Opin - ions of the State Council on Strengthening Reg - ulation, Preventing Risks and Promoting High- quality Development of the Capital Market (the “New Nine National Guidelines” ). On 24 September, the China Securities Regula - tory Commission (CSRC) released the Six M&A Guidelines, emphasising market-oriented prin - ciples and enhancing the capital market’s role in M&A.
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