Nordic Match presents the webinar Becoming Local Champions: Achieving “In China for China” through M&A
On August 23rd, Nordic Match together with Danish-Chinese Business Forum (DCBF) and Danish Chamber of Commerce in China (DCCC) hosted the webinar Becoming Local Champions: Achieving “In China for China” through M&A.
During the presentation, Tony Wang and Klaus Björkgren discussed about the changing market landscape, what companies should consider when developing a China strategy, how to identify the “right” opportunities, and how M&A can be used as a tool to achieve “In China for China”.
While the market has seen increasing uncertainties caused by geopolitical tensions, Covid19, and a slowing economy, there has been no evidence of companies leaving China. When looking at FDI, the stable growth indicates foreign companies’ confidence in the market, also seeing major investments from Nordic companies into China within the past 12 months.
However, it has become more important than ever to think long-term, and develop an aligned China strategy that is both realistic and based on facts, so that resources can be allocated where they have most impact.
China has been on a major transformation journey in the past decades, urbanizing at massive speed and by its large size, become the largest market in many industries. This has resulted to significant opportunities for Nordic companies, driven by the larger megatrends, government led initiatives, as well as shifting consumer habits in China.
Nordic countries are global leaders in several of these emerging opportunities, and should therefore tap into both internal and external resources to help understand how they can contribute to China’s next phase of development. And consider establish dedicated China Advisory Boards, to help navigate through the process.
When the opportunity has been identified, M&A can be used as an efficient strategic tool to expand the footprint, manufacturing capacity and distribution channels. With the acquisition of a “local champion”, the company can gain a local brand, and through its existing platform build a competitive position for example in a previously untapped mid-market segment.
The need to localize has become more important as Chinese competitors are upgrading their products and technologies rapidly, becoming dominant players in the midrange segments and outgrown MNCs.
However, there is no standard formula as the market is changing rapidly, and therefore companies need to stay creative when planning their M&A roadmaps.