On The Motivation, The Risk And The Performance Of The Cross-border Mergers And Acquisitions Of Chinese Enterprises

With the development of economic globalization and integration, cross-border mergers and acquisitions has overtaken green-field investment as the major form of international direct investment in recent years. Chinese enterprises, mainly large-scale state-owned ones and high-tech private ones, have also participated in this tide. By means of cross-border M&A activities, Chinese enterprises could enlarge their product market, acquire crucial technology and resources, and improve their international competitive capacity. However, cross-border mergers and acquisitions is a handle of double-sides sword. It brings benefits as well as risks. Compared with internal M&A, cross-border mergers and acquisitions is confronted with higher risks and larger challenges. How to control risk and improve the performances in the cross-border M&A activities is an important research topic.Based on the analysis of the risk and performances of the current cross-border M&A activities of Chinese enterprises, this paper try to find out the problems existing in such activities, and the possible solutions to the problems from the perspectives of both Chinese enterprises and Chinese government. In addition, this paper gives some suggestions on the strategic measures of cross-border M&A to Chinese enterprises and Chinese government.This paper is divided into six chapters. Chapter One is the definition preparation, which explains the major concepts frequently used in this paper, including the concepts of cross-border M&A, FDI, etc. Chapter Two reviews some theories about cross-border M&A. In Chapter Three the paper reviews the history and current situation of cross-border M&A in the world and in China, analyzes the conditions and motivations of Chinese enterprises to conduct cross-border M&A. In addition, the characteristics of the cross-border M&A activities of Chinese enterprises are also analyzed in this chapter. Chapter Four analyzes the main risks and problems Chinese enterprises have encountered in conducting cross-border M&A. In Chapter Five the paper makes a statistic compare of operation achievements before and after mergers and acquisitions of Chinese enterprises in order to get positive results. Chapter six gives some strategy suggestions on cross-border M&A to Chinese enterprises and Chinese government.