It started with low-awareness deals like 3Com’s partnership with Huawei. Then came the big whopper of a deal – Lenovo Group snapping up IBM’s PC business for $ 1.75 billion. Today comes news that Chinese appliance maker Haier is looking to make a bid for Maytag for $1.28 billion. Another whopper of a deal is in the making: CNOOC Ltd., China’s largest offshore oil and gas producer, may bid about $20 billion in cash for Unocal Corporation., the eighth-biggest U.S. oil company, an offer that could beat out Chevron.
And this just might be the beginning, according to my colleague, Paul Kahila, whose Business 2.0 story, Why China Wants to Scoop Up Your Company? in the June 2005 is the proving to be quite prescient. He predicted the Maytag-Haier tie-up in his story. “Often, it’s name recognition that Chinese companies crave, since a history of communism has left them relatively clueless about building brands. The prime targets? American brands and manufacturers, as well as distributors that peddle Chinese goods,” writes Kahila. Driving the trend: Chinese desire to lighten up on US bonds and loading up on corporate assets. Of course they are eyeing the fat margins the brand names earn in the US, and have decided that they no longer want to be “world’s factory.”