The biggest Chinese-owned companies employ more than 75,000 people in the UK and contributed total revenues of £92 billion to the country’s economy last year.
Tou Ying Tracker continues to expand
This is the third consecutive year that the number of Chinese businesses in the Tou Ying Tracker has expanded. The number of Chinese businesses operating in the UK has grown by 5% from 2019, highlighting the continuing attraction of the UK as an investment destination for Chinese businesses. New entrants this year include Bright Scholar, Gate Gourmet London Ltd, Guidedraw Ltd, Lander Sports (UK) International Investment Co Ltd, and Stemcor London Trading Ltd.
Chinese-owned businesses contribute to regional economies and employment
The number of UK jobs created or supported by Chinese investment also continued to rise for the second consecutive year. Of the total, 53% of employees working for Chinese companies registered in London and the South East. The remainder (47%) – over 35,360 people – are employed in the 10 other regions of the UK, including the North West, East of England and West Midlands. Most employment (63%) is accounted for by companies filing revenues between £50 million and £1 billion.
Focus on mid-market companies reveals true spread of investment
The revenues generated by Tou Ying Tracker companies are driven primarily by a small number of large manufacturing and industrial companies with revenues over £1 billion. However, a closer focus on mid-market companies (with revenues less than £1 billion but greater than £50 million) reveals that Chinese investors are active across a range of sectors. Technology, media and telecoms, business support services, and consumer are all well represented.
Deal activity continues despite the pandemic
Mergers and acquisitions form an important component of Chinese investment in the UK. In 2020, this activity continued despite the pandemic – albeit at subdued levels. Key deals during 2020 included a £101.5 million investment into the immunotherapies development company, Immunocore, by a group of investors including Hongling (Shanghai) Equity Investment and WuXi AppTec’s Corporate Venture Fund, and LionRock Capital’s £100 million acquisition of a majority stake in Clarks.
A force for prosperity
The year ahead holds much hope for ongoing trade and collaboration between the UK and China. As the year starts, China’s 14th Five-Year Plan gets underway and the UK begins to trade as a sovereign nation for the first time in almost 50 years. Despite the inevitable interweaving of trade and politics and the tensions this creates, these are times of great opportunity. A strong and enduring partnership between China and the UK can be a force for future growth and prosperity in both nations.