Does Resource-Oriented Outbound Acquisitions Create Value For Chinese SOEs

CNOOC’s acquisition of Nexen is the largest cross-border acquisition completed by a Chinese company as of today.By using various evaluation methods,the acquisition was widely proved to be anticipated as a significant value destruction for CNOOC’s shareholders.By conducting sensitivity analysis,the acquisition of Nexen is proved to have deteriorated the fragility of CNOOC’s upstream exploration and production business and aggregated its sensitivity to crude oil price.State-ownership was found to have played an important but complicated role in this acquisition in decision making,ownership participation and bidding price,and post-acquisition integration.