The Theory Of Cross-border M&A Location Choice And Its Exertion In China

No matter by what kind of standard, the geographic distribution of Cross-border M&A (Merger and Acquisition) is overwhelmingly uneven. The North America, the Europe and the Australia have attracted over 80 percent of Cross-border M&A in the world, and the developing countries and regions are still acting as supporting role. In China, Cross-border M&A investments are mainly made in the coastal developed area. Why does the uneven distribution occur? What factors decide the distribution of Cross-border M&A? In order to attract more Cross-border M&A investment, how does China improve its investment climate? These questions addressed above are the main topics of this dissertation.Based on the theory of Cross-border M&A, FDI (foreign direct investment), and the theory of location, this paper, constructing a theory frame and an evaluating system, analyzes the location choice of Cross-border M&A and further advances the location theory of Cross-border M&A. The determinants addressed in this paper are divided into three categories. One is cost determinants, including labor cost, transport cost and information cost. Another one is market determinants, including market size, the mature of the market and the development level of the agencies. The last one is policy determinants that include the attitude and policies to Cross-border M&A, the effectiveness and efficiency of legal systems.Aiming at the essential characteristics of Cross-border M&A, this paper chooses seven evaluating indicators to analyze the location of Cross-border M&A in China. The results show that Cross-border M&A tends to inflow into the coastal developed cities and the regional central cities. After entering the WTO, the investment motivation of Multinational Corporation (MNC) in China is to obtain strategic asset and long-term benefit. Policy determinants and market determinants become the most important decisive factors.Under the background of the economic globalization, China has become a merging market with the highest potential in the world, and Cross-border M&A is becoming the main way of attracting foreign investment progressively. In order to widen the channel of attracting foreign investment, attract Cross-border M&A investment energetically, and promote the competitiveness, every region of China must change the idea, cognize the advantages and disadvantages of Cross-border M&A, define the guidelines, and strengthen infrastructure construction, accelerate the urbanization process of the area. Aiming at the determinates of the location choice of Cross-border M&A, every region must set up all-around agency servicesystem, perfect the interrelated law, and construct a better environment for Cross-border M&A investment.