Institutional Distance,bilateral Political Relations And Cross-border M&A

General Secretary Xi in 2020 put forward "to the domestic large cycle as the main body,domestic and international dual cycle promotes" new development pattern theory also stressed several times still unswervingly implement the opening to the outside world,and not only to promote enterprise transnational merger and acquisition to absorb overseas key resources,but also a as an important means of enterprise accelerate the internalization of overseas high quality technology,It has an important strategic position in removing institutional barriers that restrict the promotion of technological core competitiveness,accelerating the problem of technological "bottleneck",effectively realizing the breakthrough from "low-end manufacturing" to "high-end creation",and strengthening the "complementary chain" effect of the integration of supply chain,innovation chain and value chain.Therefore,it is of great theoretical significance and practical value for enterprises to realize technological innovation and value chain reconstruction to study the influence of institutional differences and bilateral political relations on overseas M&A transactions.This paper selects the cross-border M&A events of China’s A-share listed companies from 2010 to 2020 as the research object,discusses the influence of institutional distance and bilateral political relations on the completion rate of cross-border M&A under the framework of institutional arbitrage logic,and studies the boundary conditions of the relationship between the two from the macro and micro perspective.That is,whether the influence of institutional distance between the two parties on the completion rate of cross-border M&A is influenced by the political relationship between the two countries and the marketization level of the region where the acquirer is located.Following the main line of cross-border M&A transactions,this paper further explores the factors affecting the efficiency of the completion of the transaction in the sample of transaction completion,so as to enrich and comprehensively study the influence of institutional factors and political factors on the process of cross-border M&A transactions.Through empirical tests,the main conclusions of this paper are as follows :(1)due to the interaction between institutional avoidance mechanism and institutional utilization mechanism,institutional distance has an inverted u-shaped relationship with the completion rate of cross-border m&a;(2)Good bilateral political relations can not only improve the completion rate of cross-border M&A,but also have a substitution effect with institutional distance,which weakens the inverted U-shaped relationship;In addition,the marketization level of the region where the acquirer is located strengthens the inverted U-shaped relationship;(3)Further mechanism tests show that institutional distance can improve the completion rate of cross-border M&A by influencing the hiring of financial consultants.On this basis,this paper argues that enterprises should not only pay attention to the institutional differences between the two parties of m&a,but also pay attention to their political relations,and make reasonable use of national political convenience and professional strength of intermediary agencies to improve the completion rate of their own cross-border M&A transactions.The possible innovations of this paper are as follows :(1)from the perspective of research,it makes up for the deficiency of previous studies on the relationship between institutional distance and completion rate of cross-border m&a from a single mechanism,and reveals the influence mechanism of institutional distance on completion rate of cross-border m&a;(2)on the research content,reveals the institutional distance and the role of the complex relationship between cross-border m&a transactions completed border,confirmed the micro-level acquirers heterogeneity region system and macro level of bilateral political relations the adjustment role of the relationship,the system complexity of these findings for emerging market provides new insights.