Will developed countries end up in the hands of emerging countries?

According to a PwC study, new buyers are coming from emerging markets. In 2012 alone, investors from high-growth economies made $32.6 billion worth of purchases in developed economies, three times more than in 2005.

Over the last 5 years, the flow of investment from emerging to developed countries has been greater than in the opposite direction.

Over the last 5 years (2008-2012), mature economies have invested $151 billion. The data includes the following countries: USA, UK, Germany, Australia, Japan and Canada. In contrast, emerging countries (China, India, Russia, the Middle East and Brazil) have invested $161 billion over the same period, exceeding this by $10 billion. "China and India lead in terms of both the number of operations and the volume invested, but each has evolved differently. China started 2006 from a lower position than India but has grown steadily. India, on the other hand, has had two downturns in both 2009 and 2012. We expect India to regain positions equivalent to China's in the coming years," says Diego Gutierrez, corporate finance expert at ABRA INVEST.

Motivations of companies in emerging countries in their purchases.

• They seek access to new sales channels for its products and services or strengthen its distribution channels. A good example is India's Wipro Technology Services, which in 2012 bought 100% from US-based Science Applications International for $105 million.
• Incorporate new technologies and know-how to be more competitive and to apply to their domestic business. "We are currently closing the deal for the purchase by a Chinese company of a Spanish company that, despite being much smaller and having a small market share, has technological capabilities that attract the attention of investors," reports Diego Gutierrez.
• Access to already recognised brands in mature economies rather than having to build them from scratch. This is the case of China's Bright Food and its acquisition of the British company Weetabix, which has allowed it to enter fully into the European food market.
• Moving from being a company regional to global in a rapid manner. For example, the purchase of the US film company Entertainment Holding by the Asian group Dalian Wanda.

Investor profile changes

Traditional investors - sovereign wealth funds or state-owned companies - are being joined by large and medium-sized private companies in these markets. In China, for example, private equity and finance companies are showing the most interest in buying in developed markets. For Indian companies, for example, the UK market has become one of the most attractive in Europe. In Brazil, the moderation of economic growth in recent years is spurring large and medium-sized Brazilian companies to enter markets such as Europe and the United States, with which they have traditionally had very close ties, and in the Middle East, buyers will continue to be mainly sovereign wealth funds and state-owned companies.

"This trend appears to be in its early stages and is expected to become more significant in the coming years. Currently, the weight of these transactions is very small, representing only 1.5% of total transactions," predicts Diego Gutierrez.