Case Study On The Cultural Integration In International M&A Of Chinese Enterprises

Cross-border mergers and acquisitions is one of the most important means forglobal resource allocation, and also an important step must be taken for China’sintegration into the global economy. In recent years, China actively involved in globalmergers and acquisitions, becoming an increasingly active role in this field. The size ofthe cross-border mergers and acquisitions of Chinese enterprises is in expanding thefield of mergers and acquisitions is also to diversify. However, whether to acquireadvanced technology, high-end talent, or to enhance the brand through this, all facedwith numerous difficulties. Cultural differences, brings about huge difference inbusiness philosophy, way of thinking on both sides in the cross-border mergers andacquisitions, cultural integration is a key factor related to M&A success or failure.Firstly, elaborated the importance of cultural integration in the cross-bordermergers and acquisitions in China’s enterprises by combining with the status quo,characteristics and motivation of cross-border mergers and acquisitions in China, andanalyzed the main problem facing china’s enterprises in cultural integration.Secondly,on the basis of domestic and foreign scholars’ research, proposed the concept of thecultural patterns of Magical Squares by making the degree of both sides’ willingness toaccept each other’s cultural strength as the dimensions, and analyzed the scope ofapplication of the nine models. Again, cultural integration is divided into three periodsof early, medium and late. Described the cultural integration of these three periods,raised the specific strategies and implementation processes. And proposed dynamicmodel of cultural integration by combining Magical Squares and cultural integrationprocess.Finally, selected two cases of Haier’s acquisition of Sanyo Electric, and Geely’sacquisition of Volvo as a comparative analysis, analyzed the different backgrounds and problems and the degree of difficulty of the two Chinese companies faced in theimplementation of cross-border M&A cultural integration issues, and thus chose adifferent cultural integration model, elaborated and demonstrated the previouslyproposed theory. When drew lessons from the past, also made recommendations forcultural integration in implementation of cross-border M&A, to provide a reference forChinese enterprises to help them carry out effective cultural integration, and make theirM&A successful.