System Of The Foreign Investment Agreement To Acquire China's Listed Companies

As a more rapid market access model than the Green Field Investment, multinational merger and acquisition is playing an increasingly important role in international economic life at present. How to conform to and make use of this trend is of great significance to our country's sustainable utilization of foreign investment, the domestic industry upgrading and the optimization of the management structure of enterprise legal person. However, merger and acquisition will be merely "empty talk" without a market developing to a certain extent. The security market of China, after over a decade's development, has been able to provide quite some conditions for the carrying out of merger and acquisition, especially there have already been many listed companies primarily possessing enterprise legal person management structure. In such context, the author tries to explore and solve the following questions: what are the possible models for foreign merger and acquisition? What is the most feasible model under the special market conditions of China? How to establish a merger and acquisition model worth referring to?Traditionally, Chinese scholars divide acquisition into two categories, take-over by offer and purchasing through agreement. In the author's opinion, purchasing through agreement would be more practicable and acceptable considering the status quo of share structure in China. The foreign investors shall include, acting as subjects for the purpose of acquisition, enterprises wholly owned by foreign, contractual or equity Sino-foreign joint venture enterprises, foreign enterprises, natural person and business institutions. The object of acquisition shall extend to convertible bonds and warranties without limitation to shares, no matter negotiable stocks or non-negotiable stocks. Consideration of acquisition shall be paid mainly by cash with complement of equity interest of domestic enterprises lawfully held by the foreign investors.In summary, the regulation on acquisition of Chinese listed companies by foreign investors through agreement is an indispensable part for the merger and acquisition mechanism on security market in our country, which has been and will continue in quite a long period to be the most active factor for our security market. The establishment and improvement of such mechanism will be important reference for the development of the enterprise merger and acquisition in China.