The Study Of The Strategy For Overseas M&A Of Zhuzhou Times New Material Technology Co.,Ltd

The global financial crisis has resulted in the overall recession to the world economy since2008. Today the conventional advantageous industries including manufacturing sector of western countries have sunk into difficulty caused by the European debt crisis and the sluggish US economy as the aftermath of the global financial crisis. However, such crisis has brought about the historic opportunity for the Chinese enterprises to carry out the overseas mergers and acquisitions (M&A), arousing the appeal for acquiring the slumping companies in a ’bargain-hunting’manner. There also have been more and more practices of Chinese enterprises implementing the mergers and acquisitions in recent years, in the process of which the transaction amounts have been inflating remarkably as well. Sensationally, the transaction that Geely bought the one hundred percent of Volvo’s shares has been the largest one among all such cases in terms of transaction amount.For most of the Chinese enterprises, it’s out of question that the overseas mergers and acquisitions are much more complicated, difficult and risky than the similar transactions taking place in China. There are only a few successful examples of Chinese companies taking over the overseas targets. Therefore, it would be greatly helpful to study the those successful cases of Chinese acquirers, as they are all aiming to acquire the advanced technologies, famous brands and market shares both domestically and abroad so as to upgrade their businesses in long run.This article studies the strategy for overseas M&A as well as its implementation of Zhuzhou Times New Material Technology Co., Ltd (TMT), a listing company, who acquired an Australia company named Delkor. Based on this study, the author is able to set out the importance of the strategy-driven M&A, transaction and the conclusion that the unambiguous M&A strategy is the overwhelming key factor to the success of the M&A transaction.There are six chapters in this article. Chapter1explains the background, significance, logic and methodology of the study. Chapter2introduces the related theories about M&A. Chapter3demonstrates how TMT works out the strategy for overseas M&A. Chapter4describes how TMT’s carried out overseas M&A via the case study. Chapter5enumerates the risks and the respective recommended mitigating measures. Chapter6concludes the experiences and lesson learned from the aforementioned case.The innovation of this article is the studying of the forming and implementation process of the strategy for overseas M&A according to the related theories, based on which the rationale of strategy-driven M&A is then presented. The analysis and conclusion hereof is helpful for those Chinese companies who are ready to carry out the overseas M&As as a reference.The deficiency of this article is the limited sample space where the comparison with the successful practice of acquiring some larger targets is not conducted. This is surely the direction for future improvement as well.