Cross-Border Mergers And Acquisitions--New Investment Strategy For Multinational Companies In China

In the last decade China has seen an increasing number of Cross-border mergers and acquisitions that were driven by the growth, rationalization, unlock of shareholder value as a response to the continuous pressures from globalization and technological change. This article starts from the international situation and combines the particular case of state owned enterprise reform to find a new way for state owned enterprises renaissance. To reach such an ideality, this article analyzes from two main perspectives. First, it discusses positive and negative effects in mergers and acquisitions and solutions. Second, it discusses problems in the post merger integration and attempting to make efforts on the integration researching. In the 2nd chapter, the author firstly addresses herself to the motivation of Cross-border mergers and acquisitions and their advantages, which may create innovation involving system, technology and management in state owned enterprises. Secondly, the author prudently points out challenges and shocks bringing along with the innovation, such as state owned assets loss, multinational companies monopolized in referred industry, R&D ability restriction, new demand to China industry policy and brain drain, etc. In the 3rd chapter, to solve the problems and to reduce risks in reform, the author tries to find out solutions to make our state owned enterprises get further improvement and to keep national economic safety. Those solutions consist of: expand capitals resources, industry policy adjustment, system reform and law making, etc. In Chapter 4, considering the lessons from failed integration cases, analyzing the problems may come up in the integration process and take cautions to deal with them. The integration included four aspects: system integration, operation integration, human resources integration and culture integration. Integrations in each part have some constructive suggestions. Finally, the author concludes that Cross-border mergers and acquisitions not only could bring capitals, advance technology and management but also achieve the brighter tomorrow of state ownedenterprises reform in China.