Risk Analysis Of Cross-border M&A Of China Petroleum Enterprises

Chinese economy has made great progress since China’s reform and opening up.The growth of the national economy comes up with huge energy consumption. Oilsupply security has become an important issue since the domestic production can’tmeet the rocket growing domestic demand resulted from the growing economy in theearly1990s.The paper studies the risk analysis of cross-border merger and acquisition ofChina Petroleum Enterprises and takes the CNOOC and Unocal M&A for example. Itmainly divides into6parts. The first part introduces the research background, purposeand meaning of the topic and reviews the research status at home and abroad. Thesecond part introduce the M&A’s challenges, opportunities. The third part is analyzedaccording to the order of events of M&A risk. Before the acquisition, the risk ismacro and micro political risk. During the mid-acquisition is the financial risk, itcontains the payment risk, the exchange risk, etc. Then, it is the risk of businessintegration and cultural integration. After contacting the example, it mainly introducesthe political risk and financial risk. The forth part selects the case of CNOOC’sacquisition for UNOCAL as a foundation for the later argument, to review the caseacquisition process and analyzed the cause of the failure. The fifth part puts forwardthe measures to prevent the risk of M&A according to the perspective of political riskand financial risk in order to guide and improve the success rate of M&A.The sixth part is the summary part. It puts forward the innovation and deficiency ofthis article.China petroleum enterprise should be in keeping with the trend of time, seize theopportunities to make it stronger. Other oil companies may take lessons from thecase’s failures and pay attention to reduce political risk and financial risk to have synergistic effect and alleviate the oil supply tight situation.