Firms urged to buy abroad (2)

Overall, in 2012, 329 China outbound M&A deals were completed and the value of 253 deals was revealed. The total value of these deals reached around $66.5 billion, an increase of 244 percent on a year earlier, KPMG statistics showed.

Because of the high value of some big deals completed in 2012, it was a harvest year for China's outbound M&A both in volume and in value, Fung said.

Meanwhile, private enterprise showed great potential in China outbound M&A deals. From the viewpoint of volume, the annual growth of private M&A deals overseas increased from 43 percent in 2009 to nearly 69 percent in 2012.

There is a great desire to use overseas M&A as a strategy for private enterprises to go global, to build international brands and to bring technology and know-how for use in the domestic market.

Although private enterprises take an active role in outbound M&As, quite a number of them are pretty low profile, Fung added.

"Because some governments are quite sensitive to Chinese State-owned enterprises' acquisitions in the resources sector, private enterprises may have a bigger chance in that field," said Fung.

But given the value of the M&A, State-owned enterprises will still dominate the market, he added.

On the inbound sector, there were 548 'announced' or 'completed' inbound M&As, totaling slightly more than $40 billion. This compares unfavourably with 2011, which saw more than 800 transactions totaling approximately $ 58 billion. The transaction size and number of transactions showed a more than 30 percent decline year-on-year.