The Empirical Study On Performance Of Overseas Mergers And Acquisitions For Resouree-based Enterprises

Under the background of Economic Integration since the1985’s, a new trend called Cross-border Mergers and Acquisitions was formed, which has become an important driving force of going abroad to find the strategic partner among large multinational corporations. Today, thousands of enterprises around the world are making efforts to going abroad and join the world resource redistribution, especially those resource-based companies. To these companies whose basic products and profits are built on the possess of the natural recourses on earth, going outside to gain more chances to obtain mineral, metal, petroleum, natural gas, etc. is a must, and so does the Chinese resource-based enterprises.As we all know, China’s rapid growth of the recent30years is a great success which has shocked the world economies as well as ourselves. And nobody can deny that it is closely related to China’s rapid development of the basic industries.30years before, we were still a self-sufficiency country on natural resource supplying. However, the situation has changed in the latest10years. In1992, with the first Oil Import Agreement was signed between the China National Chemicals Import&Export Corporation and the country of Saudi Arabia, China has firstly become an oil-importing country. From then on, our country was among the ones who are most sensitive to fluctuation of natural resources prices. The world financial crisis started in2007has brought a great chance to resource-based enterprises in China. With the help of dropped international commodity prices as well as the promotion of Chinese government, a large number of companies began to going abroad, seeking the strategic partner around the world. Both the volume and total price were rocketed to the highest record in history of overseas M&A transactions in China. Once upon a time, News headlines were full of greetings on Chinese resource-based companies’successfully realizing their overseas expansion. However, we have missed one important thing that it is just the first step of our enterprises overseas expansion, but where the M&A’s afterwards heading is the thing that really matters. Therefore, research on overseas M&A effect among Chinese resource-based enterprises is a must and it is particularly important.In this article, we focus on the advanced concept of mergers and acquisitions activities among the world resources-based companies. We take Chinese recourse-based enterprises who has successfully entered the world market through M&A activities abroad during the year of2008and2009, and choose the effects of M&A after2years as our most concern, hoping to gain some meaningful results, and to sum up some useful suggestions in the end.This paper was divided into7parts, details of each part are as follows:in Part One, the significance, purpose, methods used as well as innovation and defects was briefed; in Part Two, the author summarized the recent researches and their contributions on related areas; in Part Three, we searched information about the events of M&A among Chinese recourse-based enterprises in recent10years, divided the ten-years development process into3stages and summarized features of each ones; in Part Four, the author did empirical research on effects of M&A after2years based on selected data of15sample companies and resulted in some preliminary conclusions; in Part Five,6elements that affect the M&A performance was analyzed and some Chinese characteristics were involved in the discussion; in order to compensate for the shortcoming of the sample’s insufficient, a classic case of M&A was discussed in Part Six; finally in Part Seven, the author summed up some policy recommendations for based on the results of the previous research.Throughout the full article, the main conclusions are including that the two-year effects of M&A among the Chinese resource-based enterprises were not satisfactory, to give a comprehensive evaluation of the effects, we should waiting for a longer period to see, besides, the scale of the transaction, the level of economic development in targeted countries and the ownership structure of our enterprises are the main elements that affect the M&A performance. The author also suggested five measures to help improve the long-run effects of M&A.This research can provide policy guidance for the M&A of overseas strategy among Chinese resource-based enterprises, and also provide specific strategies as well as methods of operation.