Research On The Impact Of Foreign M&A On Chinese Service Enterprises Competitiveness

After the middle of the twentieth century, it is "service economy" era, developedcountries is shifting the centre of economic gravity to service industry. In the wave ofcross-border mergers and acquisitions, service firms became the focus of internationaldirect investment and industrial transfer, the amount of the cross-border M&Aaccounted for more than fifty percent of the total amount. In China, the expansion ofthe foreign M&A service industry will significantly speed up. This can stimulateChina’s economic, improve the overall level of service industry in our country,making our country service enterprise learning to multinational companies advancedtechnology and standardized management system, improve their competitiveness toobtain more opportunities. Although foreign M&A can create more internationalcompetition for service enterprises, optimizes the allocation of internal resources, butalso inevitable brings more challenges to service enterprises in our country.Based on the research of service enterprise competitiveness and foreign M&A,this paper analyzes present situation of service industry in China and the servicegeneral situation of foreign M&A. According to the summary of forefathers’ research,the article establishes the evaluation index system of service enterprisecompetitiveness; it contains six aspects which are the size of market, economicbenefits, enterprise growth, risk, assets operation and management innovation. Thispaper selects47service enterprises as the research object, which was merged andacquired by multinational companies from2000to2008in China, using FactorAnalysis and Radar Map to analyze average change of enterprise’s competitive powerof the overall sample. In addition, this paper uses nonparametric test for the featuresof M&A to inspecting, such as type of M&A, equity nature, control of affiliatedtransactions and related industries. Then it observes the influence on the sampleenterprise competitiveness after M&A, among them types and industries get thesignificance test. According to the results of the study, this puts forward relevantrecommendations. To consummate the law about foreign M&A and implement theM&A motives, related department should guide foreign enterprises to carry outstrategic M&A. At the same time, it should strengthen the regulation of corporatecontrol, and appropriately constraint M&A behavior. Paying attention to the resourcesintegration, it will promote the upgrade of industrial structure.