Study On Cross-border M&A Performence Of Chinese Companies

With the development of Chinese economy, more and more Chinesecompanies participate in cross-border M&A to grow faster. However,large amount of research indicated that most of the M&A didn’t achievegood performance. And due to the short history, we havn’t formed acomplete theoretical system.This paper studies the factors that could influence Chinesecompanies’ cross-border M&A performance, from the perspectives ofinstitutional environment and national cultural difference. We first build amultiple regression model of these three variables, and then use methodsof Baron and Zhao each to test the mediation effect. We find that:(1) Chinese companies’ cross-border M&A performance is worse incountries with different institutional environment; (2) The greater the national cultural distance of two sides, the betterthe M&A performance will be;(3) National cultural difference is the competitive mediator betweeninstitutional environment and M&A performance of companies.We find that the integration after M&A includes the socioculturalintegration and the task integration, which have almost contradictoryeffects on the M&A performance. And the institutional environment isrelated to the sociocultural integration, which is negatively associatedwith the synergy realization, however, cultural difference is related toboth integrations. We find that as far as Chinese companies are concerned,cultural difference is more associated with task integration, whichcontributes to the synergy realization and the M&A performance. As theinstitutional environment is relatively a part of the concept of culture, sowe think that it’s reasonable that the national cultural difference is thecompetitive mediator between institutional environment and M&Aperformance of companies.Based on the analysis above and some case studies of recent Chinesecompanies’ cross-border M&A, we come up with some recommendationsof future practices. We hold that Chinese companies should focus on thecommon points of two sides’ values and cultures and try to create a newculture that will be accepted and understood by two sides.