Research On Chinese Enterprises' Cross-Border M&A Cases Between 2001 And 2007

Under the new situations of economic globalization, countries worldwide have been tightly dependent upon each other. Not any country could make successful economic construction without any interaction with other countries. This trend of global M&A is the consequence of countries' increasing economic dependency on each other and has already become an obvious feature, of current world economy.As a member of WTO, China has kept its continuous opening up process in economy, which means Chinese enterprise have to take part in even more fierce market competition internationally. Compared with advanced countries, China' s cross-border business is still at its infant stage in term of investment volumes. However, multi-national companies in China are growing in both size and number.Nowdays, the fact of RMB' s rise in value has caught great attention in the world. With the increasing appreciation of RMB, the overseas asset price will decrease for Chinese enterprises, which enables exchange rate of Chinese Yuan will boost overseas investment for Chinese enterprise. Facing good overseas investment opportunities generated by continuous RMB' s rise in value, Chinese companies should grasp at these chances and make rational overseas investments.Despite the trend of economic globalization, many countries have set up trade barriers and other obstacles in order to protect local companies' interests. It will be wise to skip these barriers by operating cross-nation business. Generally speaking, there are two methods of overseas investment to make cross-border business, namely Greenfield investment and M&A. Compared with Greenfield investment, the efficiency of M&A is usually higher. Obviously, how to apply cross-border M&A theory to discussing the cross-border business based on Chinese companies' circumstances is a worthwhile topic.With the sub-loans and debt crisis occurred, which brought a lot of impact and damage to the ongoing cross-border M&A wave and may even develop into the world economic recession. But some developing countries keep the rapid economic growth. Especially China' s economy maintained a double-digit growth, China' s enterprises also showed good development trend, one after another are going out of the country and integrating the wave of transnational M&A. For example, Lenovo acquisition of IBM' s PC business, TCL acquisition of Thomson' s color TV business and the Industrial and Commercial Bank acquisition of the South African Standard Bank so on. These shows strongly that Chinese enterprise has begun to embark on the road of cross-border mergers and acquisitions.Most of the research that has been made focuses on the M &A of Chinese enterprises by foreign MENs, while limited efforts have been done to analyze Chinese enterprises' overseas M&A activities.The paper consists of six chapter of overview, which explains the paper' s research background and significance, introduces paper structure, and concludes the innovative arguments and shortcomings.The second part is the theoretical basis of this paper. This part has introduced the concept of cross-border M&A and some basic theories on M&A at home and abroad, including some viewpoints of some civil experts how to practice cross-border M&A for Chinese enterprises.The third part is consists of the third, fourth chapter, which introduced many specific examples on cross-border M&A of Chinese enterprises between 2001 and 2007, including two parts: one part is some examples about successful cross-border M&A, the other is some examples about failure M&A. The forth part is focus of this paper, the main content is to analysis those examples of the third part, including some successful reasons and failure lessons.The last part is the vision and inspiration about Chinese enterprises practicing cross-border M&A in the future. I hope these inspirations can offer some advices for Chinese enterprises.The whole five parts not only cover general theories but Chinese enterprises' actual practice of cross-border M&A as well, from which discloses strategic options of cross-border M&A which are likely to unleash Chinese companies' comparative advantage.