Endogenetic Finance Company

Multiplex operation has become the common characteristic of mainframe enterprise groups and multinational corporations and the amalgamation of industry and finance is one of very important operation method. The amalgamation of industry and finance is a dynamic process in which industrial capital and financial capital that is controlled by one enterprise penetrates and syncretises each other. These two ones develop in phase and achieve superiority supplementary and interaction. In practice, the amalgamation has various implement modalities and carriers. The endogenetic finance company which is set up inside enterprise group and is controlled by leading industrial capital is one of implement modalities. As a implement carrier, finance companies have been found and adopted by international enterprise groups generally. However, Chinese financial constraints limited our countries' finance companies development that not only resulted its quantity was few but also made its capital resource was lack and business simplified. Finance company can not effect on industry development deeply.2004 new policy for Chinese finance company was executive. It opened the door for setting up foreign sole ownership finance company in China. Undoubtedly ,this will stimulate multinational corporations financial service come into China since its industry penetrating. Whether Chinese enterprises or its internal finance companies have to confront with flinty challenge. So the study on the prime implement route of amalgamation of industry and finance inside our enterprise groups and finance companies' business mode has very realistic meaning.In the article, firstly, Based on the theory ,it analyses the amalgamation strategy's generating reason , the positive and negative effect it can bring then point out that the success and failure key lie in the balance between industry and finance structure. This...