Chinese overseas mergers and acquisitions (M&As) fell 77% in value terms in the first quarter compared with the same period last year as the nation’s businesses reported 142 overseas M&A deals valued at $21.2 billion, according to a report by PwC. The decrease in M&A activity is related to the increased scrutiny over the authenticity and compliance of overseas deals, said Zhen Zhao, director of PwC China’s M&A services. An uncertain international political environment is another contributing factor, said Zhen, adding that he expected overseas direct investment to regain “rationality” this year. Starting late last year, China stepped up restrictions on outbound investment in an effort to stem capital outflows as the yuan’s value tumbled to multiyear lows. According to Caixin, regulators were concerned that companies were pushing through deals on fears the yuan will continue to fall, and were making expensive acquisitions that did not build on core businesses.