TRANSACTION INTERVIEW 83 Considering our current deal flow and discussions with domestic clients, it is cautiously optimistic to expect to work on similar deals in the near future. Legal Advisors to MAN Energy Solutions SE: through more lengthy and complex internal procedures up to its headquarter or even the state-owned Assets Supervision and Administration Commission of the State Council (‘SASAC‘) in order to decide certain key issues in the transaction. In this process, different SOEs may adopt different fine lines and may ask either the purchaser or its engaged relevant third party agents to raise uncommon issues. Experienced PRC counsels can help international sellers understand the reasons behind and fight for a more favourable treatment to overcome such hurdles. 3) Due Diligence. Chinese SOE purchasers may apply their domestic due diligence standards to the target’s jurisdiction, some of which may appear to the target as particularly unusual or unreasonable. One important reason is the compliance issues as mentioned above. More international sellers, on the other hand, want to conduct meaningful yet limited due diligence on the PRC purchasers due to difficulties in international travels and concerns about the transparency of the purchaser group. Most gaps in this regard can be best bridged by experienced PRC counsels in a collaborative fashion. Do you expect to work on similar deals in the near future? According to the statistics from the PRC Ministry of Commerce, domestic Chinese investors made ODI investments into 3,939 overseas companies from January to May this year with a total amount of 356.46 billion RMB, demonstrating a 24.2% year-on-year growth. Due to increasing US-China tensions, Europe will continue to play a leading position as Chinese companies’ preferred cross-border M&A market. Considering our current deal flow and discussions with domestic clients, it is cautiously optimistic to expect to work on similar deals in the near future. Nevertheless, in the face of current global uncertainties and the new layer of scrutiny under the new EU foreign subsidies regulation, we expect to work closely with EU professionals to better serve our clients.
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