A Study Of Transnational Merger And Acquisition By Chinese Enterprises

The world economy has witnessed a surge of transnational merger and acquisition activities since the 90s of the 20th century up to now. With the development of economic globalization and the self-strengthening of transnational enterprises, transnational M&A has overtaken greenfield investment as the major form of international direct investment in recent years. Chinese enterprises, mainly large-scale state-owned ones and high-tech private ones, have also participated in this tide though the scale of transnational M&A activities of Chinese enterprises could not be compared with that of enterprises of developed countries. This paper will, based on the analysis of the current transnational M&A activities of Chinese enterprises, try to find out the problems existing in such activities and the possible solutions to the problems from the perspectives of both Chinese enterprises and Chinese government. In addition, this paper will give suggestions on the strategic selections of transnational M&A by Chinese enterprises, which include the suggestions on the selection of major investors, investment destinations, industries and financing methods.This paper is divided into five chapters. Chapter One is the definition preparation, which explains the major concepts frequently used in this paper, including the concepts of transnational M&A, FDI, home country and host country and TNCs. Chapter Two analyzes the conditions and motivations of Chinese enterprises to conduct transnational M&A with British professor Dunning's Eclectic Theory of International Production. Chapter Three reviews the history and current situation of transnational M&A in the world and in China. In addition, the characteristics of the transnational M&A activities of Chinese enterprises are also analyzed in this chapter. Chapter Four analyzes the current problems Chinese enterprises have encountered in conducting transnational M&A and tries to find out the solutions to those problems from the perspectives of Chinese enterprises and the government. Chapter Five gives strategy suggestions on transnational M&A by Chinese enterprises in regard to the selections of major investors, locations, industries and financing methods.