“WE ARE on a wild ride,” Tom Mangas, the boss of Starwood, an American hotel group that owns the Westin and Sheraton brands, wrote to employees this week. He was referring to the bidding war over Starwood between Marriott, another American hotel operator, and a group led by Anbang, a Chinese insurer. Anbang this week raised its offer to $14 billion. But Mr Mangas could just as well have been talking about the wave of China-led mergers and acquisitions that is sweeping over the world economy.

Chinese firms with little international experience and lots of debt have emerged as the biggest buyers of global assets. They have announced nearly $100 billion in cross-border M&A deals this year, already more than their $61 billion of foreign acquisitions last year (see chart). To be sure, announcing deals is not the same as closing them. Between losing out to other bidders and rejection by regulators, China’s investment tally…Continue reading