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Peter Fuhrman
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Chairman, Founder and Chief Executive Officer at China First Capital ( , China-focused international investment bank and advisory firm for private capital markets and M&A transactions in China. China First Capital has a disciplined focus on -- and strives for a... More
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China Private Equity
  • China M&A: Unwrapping Three Recent Deals Involving Smithfield Foods, Blackstone And CITIC Capital 1 comment
    May 30, 2013 6:07 AM | about stocks: PACT, ASIA

    In the last month, three large takeovers were announced involving Chinese companies. In two of these, PE buyout firms (CITIC Capital and Blackstone) are offering to take private Chinese companies (AsiaInfo-Linkage and Pactera) quoted on the US stock exchange. In the third, a Chinese acquirer (Shuanghui International) has offered to purchase all shares of US pork producer Smithfield Foods.

    I've done a quick comparison of these deals across a range of financial variables - premium offered to current shareholders, p/e ratio, profit growth, last two years' share price performance. I've also offered my own judgment on the scale of risk for the acquirer and the industrial logic of the deal, on a scale of 1-10.

    The results: the troubled deals, the ones with the highest risks and deepest uncertainties about future performance, with the most anemic share prices up to the date of the offer, with claims or investigations of accounting fraud, with the least industrial logic, are commanding the higher price.

    Ah, the Mysterious Orient.

    -(click to enlarge)

    Stocks: PACT, ASIA
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    The options market predicted the PACT deal about 2 weeks before it was announced:



    is the same happening at SKY-MOBI?

    7 Jun 2013, 09:21 AM Reply Like
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