Research On Chinese Enterprise’s Cross-Border M&A Financing Strategy

With the development of the world economic integration process, global investment raised to the level of development strategy by Chinese enterprises gradually. Since the21st century, as China’s wealth accumulation and the need of industrial structure adjustment, China’s cross-border M&A develop rapidly. In order to enhance enterprise’s strength, cross-border M&A has become an important means to obtain the global technology, brands and strategic resources. But cross-border M&A usually requires a huge sum of money to support, M&A financing is the key to success. At present, due to the low development degree of capital market and the defects of enterprise itself in our country, enterprise’s M&A financing channel is not unobstructed, so the process of Chinese enterprise internationalization is hindered to a certain extent. Therefore, finding a solution to cross-border M&A financing difficult problem is increasingly important in China.This paper first compares the payment and financing of cross-border M&A of Chinese enterprises with some enterprises in developed countries, such as Britain, the United States, Japan. And points out the existent problems in the financing of cross-border M&A including the singleness of payment, the narrowness of financing channels, the unclosed relationship between banks and enterprises in financing,the insufficient understanding of financing risks, the serious nonstandard operation in financing,the lack of financing options. At the same time, this paper analyses the internal and external reasons of cross-border M&A financing problems. External reasons include the underdeveloped capital markets, imperfect legal policy, and the limited function of financing intermediaries. Internal reasons include the enterprise’s small strength, the low international popularity, the low level of management, the low credibility; the shortage of M&A financing talent and experience, the simplification of financing decision factors. Finally, based on the analysis of current situation, problems and the reasons, the paper puts forward some concrete suggestions to optimize our country’s enterprises cross-border M&A financing strategy. Suggestions is put forward mainly from the angle of financing channel, financing risk prevention, financing talents, enterprise image promotion, financing negotiations,M&A various sides benefit gambling, is a dynamic financing strategy.