Research On The Conspiracy Of Multinational When Establishing Joint Ventures With Chinese Enterprises

Since China’s reform and opening up, China’s absorption of foreign directinvestment has increased year by year. In the process of cooperating with foreigncompanies, Chinese enterprises can learn advanced technology and knowledge. But inrecent years, a large number of China’s enterprises get losses or be annexed to theforeign party after carrying out joint venture with foreign companies instead of gettingpromoted. In recent years, the new trend of foreign direct investment in Chinahighlights: Multinational establishes joint ventures with Chinese enterprises first, thenthe multinational makes the joint venture got lost seriously, at last, the multinationalMergers and acquisitions the joint venture.Aiming at this kind of phenomenon, this paper summarizes the path of theforeign companies "joint venture-loss-M&A" Chinese enterprises and foreignmotivation and means on the basis of domestic and foreign scholars’ research. Next,this article puts forward "joint conspiracy" three stage model when multinationalestablishing joint ventures with Chinese enterprises, this model is on the basis of thepresent situation and related foreign and domestic research. The model explainsforeign conspiracy and operation means of two angles of evolution mechanism andbenefits change in the process of the foreign companies "joint venture-loss-M&A"Chinese enterprises. This part lies theoretical foundation for the later research andputs forward the related research hypothesis in order to prepare well for the empiricalstudy later. Then this article compares the two kinds of Chinese enterpriseperformance, one is the kind of Chinese enterprise which only joint venture withforeign, the other one is the kind of Chinese enterprise which joint venture withforeign and be Merged by foreign companies, this paper comes to the conclusion thatmultinational establishing joint ventures with Chinese enterprises exists conspiracy.This article uses difference-in-difference (DID) method to evaluate foreign conspiracyand find out the main risk factors. From this research we learn that the foreign mainlyuses equity operation to achieve its plot. In addition, the Chinese enterprises’ owngovernance structure is also gives foreign chink in the wall. Finally, this paper putsforward the corresponding suggestions to prevent the foreign joint venture conspiracy,including: choosing the right partners, grasping the joint negotiating firmly, breakingthe sino-foreign joint venture practice, forming an alliance with industry enterprises,identifying and stopping the foreign conspiracy in time, coping with foreign mergers and acquisitions behavior, enhancing supervision of large shareholders’ behavior.This article puts forward "joint conspiracy" three stage model whenmultinational establishing joint ventures with Chinese enterprises, this model showsthe control process of foreign venture plot clearly, It’s the first time to analysis thepath of foreign "joint venture-loss-merger and acquisition of Chinese enterprises"path system and deeply, this is the place of innovation and also a core content. Themodel has the effect to enrich the existing theories further, and also plays a warningrole for Chinese enterprises to prevent foreign plot. Using DID models to analysis theconspiracy is also the place of innovation. The method using two kinds of samples toanalysis the conspiracy fits the research train of thought, and is more scientific. Themodel makes up the defects of the existing research lacking of empirical analysis.This paper not only realizes the further recognition of foreign conspiracy, bur alsoachieves the evaluation of foreign conspiracy and digs out which means mainlyadopted by foreign companies by DID method, At the same time, the empirical resultssupport the "joint conspiracy" three stage model "joint conspiracy" three stage modelwhen multinational establishing joint ventures with Chinese enterprises, with strongscientific and convincing. In addition, the suggestions for Chinese enterprises toprevent foreign "plot" joint venture has a certain reference significance.