Research On Resource-based Enterprises’ Overseas M&A Decision-making

Although in recent years the economic and financial crisis led to the global economy in the downturn and M&A market quiet, but the current integration of global resources of the industry is still in the golden age. Especially the domestic demand shocks of resource make emerging market countries to become the protagonist in the overseas M&A market, and China is one of the typical representatives. According to figures provided by the Ministry of Commerce, overseas M&A in China has entered a period of rapid development since 2002, especially in the 2008-2012 years more quickly, and has gradually become the implementation of the "go out" subject strategy. Resource-based enterprises in the number of overseas M&A in 2008-2011, respectively accounted 35.00%,41.10%,36.00%,29.87%, indicating that the resource-based enterprises overseas M&A in recent years to dominate the overseas M&A. However, successful cases of many resource-based enterprises overseas M&A transactions occupy only a small part, and the failure of its overseas M&A decisions seriously affect the company’s operating performance. And then how resource-based enterprises consider all factors when making overseas M&A decisions, to make overseas acquisitions successfully, need to conduct in-depth research.The paper research content:Firstly, this paper summarized the domestic and foreign relevant research of overseas M&A; secondly, put forward the concept of resource-based enterprises and overseas M&A on the basis of previous, and elaborated the related basic theories of overseas M&A; thirdly, from the performance perspective, combined with the internal and external environmental factor, selected quantifiable factors that affect the M&A decision-making, put forward the hypothesis, took the 39 resource-based listed enterprises that had taken place overseas M&A in 2002-2012 year as samples, and screened out the factors significantly associated with the M&A decision-making as input variables of the decision tree model through linear regression; then analyzed the M&A decision-making by the decision tree model in data mining; finally, according to the conclusions of the study, put forward policy recommendations.The conclusion of the study:Target corp’s economic environment downturn, sufficient operating cash flow, a good domestic economic conditions and higher equity balance are conductive to the implementation of overseas M&A decision-making; but the high rata of assets and liabilities, high operating leverage as well, is not conductive to the overseas M&A; the order of six indicators in the tree diagram from top to bottom is that target corp’s economic environment, operating cash flow per share, asset-liability ratio, equity restriction, operating leverage, the domestic economic environment, and this provides some reference for resource-based enterprises when they are making a M&A decision-making and considering these factors.