Chinese Enterprises To Participate In Cross-border M & A Theory And Countermeasures

With the development of globalization, the Fifth trend of Cross-border Mergers & Acquisitions (M&A) bloomed in the early 1990's. One of the most remarkable trends of the global market is the growing development of cross-border M&A, which has been changing the global economic circumstance in an incredible way. As one of the flourishing economy units in the world, the Chinese enterprises actively participated in this trend. Some enterprises have succeeded in cross-border M&A transactions. However, generally speaking, the Chinese enterprises could not catch up with the enterprises of the developed countries whether in scale or experience. Therefore, it is highly worthwhile to make research on cross-border M&A for enterprises in China in order to instruct the cross-border M&A transaction by revealing the regulation and strategy choices. Focusing on Chinese enterprises, this paper makes a review of the development of cross-border M&A implemented by the Chinese enterprises on the basis of the introduction of the theories of cross-border M&A. It analyzes the advantage and the motivation of the Chinese enterprises' cross-border M&A-to explore the comprehensive advantages of proprietary rights, internalization and locations which is based on the structure of the Eclectic Theory of International Production; it analyzes the advantage of the Chineseenterprises in cross-border M&A and makes the tactic research of the Chinese enterprises' cross-border M&A, and puts forward the strategy according to the problems.In the present situation, the advantage of the cross-border M&A of the Chinese enterprises is appearing obviously. On the one hand, it is due to the free commerce environment internationally, on the other hand, it is determined by the remarkable improvement of Chinese enterprises' international competitive capacity, the enhancement of China's overall economic potentiality and policy support provided by the government. Although the motivation of cross-border M&A is varied, the positive support provided by the government is essential on the position and industry choice. On the position choice, we should concentrate on the Asia countries which have cooperative tradition with us, develop the new investment market, attempt to invest in the developed countries such as America, industry Europe and Japan. On the industry choice, we should focus on the exploiting and manufacturing resources, on the industry which has competitive advantage. This essay also points out that we should make efforts in the following aspects in order to implement cross-border M&A effectively and successfully, such as to consummate the law system of cross-border M&A, to master and comply with the international competition rules, to broaden the financing channel, to consummate the FDI examination and approval system, to strengthen theinformation system and information network construction, to train the transnational management talent, etc.