2005 saw a some high profile deals where Asian companies bought American and European brands.
The Chinese electronic company Levano’s acquisition of IBM’s computer division gave Levano a multinational presence and the ability to leverage its manufacturing and extend its reach into the global consumer marketplace.
Chinese television manufacturer, TCL, acquired RCA, another example of a Chinese manufacturer looking abroad to buy a brand and capture margin and sales sustainability.
BenQ acquired the mobile phone business from Siemens and German TV business Grundig was acquired by an Asian company as well.
Besides maintaining profit margins and gaining market access two factors are contributing to the Asian buying spree.
One is the growing enforcement of intellectual property laws.
Companies, who have relied on manufacturing pirated and counterfeit goods, suddenly face real legal challenges. They realize that in order to survive, they need to acquire established brands and begin to develop their own, or be knocked out of the marketplace.
And, over the past years Asian companies have been stockpiling US dollars. Now these companies begin to utilize the “war chests” in their acquisitions of American and European brands.
We are sure, there is more to come.