Research On Risk Control And Management Of HBIS Group’s Cross-Border Acquisition Of Serbian Steel Mill

The republic of Serbia in central and eastern Europe is the first country to establish strategic cooperative relations with China and to actively respond to the "One Belt And One Road" policy.The smederevo steel mill in Serbia,which was founded in 1913,was the only state-owned large-scale pillar enterprise.Due to the poor management of former managers and other factors,the steel mill once lost money and was on the verge of closure.On April 18,2016,HBIS group and the Serbian government have signed an agreement to acquire smederevo steel,and HBIS group has invested 46 million euros(about 350 million yuan)to set up HBIS Serbia company.After the acquisition,HBIS group adopted high-end management technology,environmental protection technology and other means,so that it used for half a year and turned itself before seven consecutive years of losses.This paper takes the case of HBIS group cross-border merger and acquisition of smederevo in Serbia as the research object.By using various analytical methods,such as literature research,case analysis,investigation,qualitative and quantitative research,this paper has deeply studied the related risks of cross-border merger and acquisition of enterprises and the corresponding control measures.Firstly,on the basis of the theory of transnational merger and acquisition and the literature at home and abroad,this paper introduces several common risks of transnational merger and acquisition of enterprises and their risk assessment methods.Then it introduces the two sides,the motivation and the process of the case in detail.Then it analyzes the risk of this case according to the risk identification,risk assessment and risk prevention and control procedures of cross-border m&a,and adopts qualitative and quantitative analysis methods to evaluate the risk.Finally,based on the detailed analysis of the risk of this case,the successful means and thoughts of HBIS group to avoid the above risks are summarized:In the preparation stage of merger and acquisition,HBIS group bought overseas investment insurance of China export credit insurance company to avoid political risk.It has solved the legal risks related to environmental protection in the past through its rich experience and technology related to environmental protection.It has managed economic risk by relying on the timing capabilities of its already-acquired Swiss subsidiary De Gao.In the implementation stage of m&a,it used financial derivatives to manage and control the exchange rate risks in the global industrial chain.In the integration stage of merger and acquisition,it carried out a variety of cooperation with the upstream and downstream enterprises of the steel industry chain to promote the vertical integration development of the deep processing chain of iron and steel materials.On the basis of"cultural localization",it controlled cultural integration risk with reference to the dynamic cycle model of cultural integration risk management.It managed the risk of human resource integration through "employing localization".It controlled the risk of business integration by virtue of the decision-making ability and marketing ability of De Gao.In addition,HBIS group relied on the government’s help,so that the merger could proceed quickly and smoothly.Through the study and summary of these successful practices,we can provide reference for Chinese entity enterprises in overseas transnational merger and acquisition of risk management and control.