Asian MNCs to accelerate overseas expansion - Towers Watson

The 2012 Asian MNC Study conducted by global professional services company Towers Watson found that 70% of respondents intend to engage in multi-country M&A activity in the future.

According to Towers Watson, these "Asian trailblazers" pose a competitive threat to their North American and Western European counterparts, primarily due to the marked shift in their global expansion strategies when entering new international markets.

Many have already established a notable presence in North America and Western Europe, where they have gained knowledge and capitalized on competitive strengths. Indeed, 56% of the respondents said they did not initially enter markets in Asia, but instead expanded into North America or Europe first.

"These companies have adopted well-defined globalization strategies. They understand the need to evolve quickly and adapt to the challenges of the new global landscape they are shaping," said Gavin Watkins, Towers Watson's Director, Client Development Group, Asia Pacific. "Their North American and Western European counterparts need to take them seriously as they emerge as significant challengers in the global business world."

Nevertheless, Chinese companies in particular - which are increasingly looking to buy assets overseas - need to ensure they have a timely strategy in place to integrate any new acquisitions with their businesses in China.

Marco Kaster, M&A advisory leader for Asia Pacific at Towers Watson, told AVCJ last September that some Chinese companies just don't act fast enough in doing this.

"I went to see a Chinese company three months ago that had just made an acquisition overseas," he recalled at the time. "After about five minutes, they started talking about a smaller acquisition they made three years ago. It was only at this point - three years down the line - that they began to think about how they could make the entity work with their Chinese business."

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• Topics
• Investments
• Greater China
• Advisory
• Towers Watson
• M&A
• China