Study On The Driven Factors Of Chinese Strategic Asset-Seeking Cross-Border Mergers And Acquisitions

In the past ten years, Chinese enterprises’ merger and acquisitions have been into the most prosperous period, the asset-seeking cross-border merger and acquisitions is the most remarkable one, because it is very different from the traditional one.Through reviewing the existing literature we can find that current studies focus on the motivations on the side of purchaser in merger and acquisitions. Although scholars have proposed many motivations and driving factors but those are too fragmented, unsystematic. Previous studies often just start from a particular theoretical perspective (eg institutional perspective) and combine individual case studies, which did not reflect the deeper driving factors and can not be fully present the content and overall structure of them. These could hinder a more detailed in-depth research. Secondly, only a few studies provide some information about the driving factors on the side of sellers, the both side integrating factors contributed to facilitate transactions are rarely involved, which has become the limitations and missing of the existing studies.In addition, previous studies implicitly assume that the "mergers are similar," but when we look deep into the strategic asset-seeking mergers and find that there are also great differences among them.Based on the above discussion, the paper will take the successful Chinese enterprises’strategic asset-seeking cross-border merger and acquisitions transactions from2001to2011as objects from the driving factors and interactive relationship. We identify the drivering factors through the ground theory from the three views of macroscopic, industry and enterprise, and also tease out the mode of Chinese enterprises’ cross-border mergers and acquisitions systematicly. Compared with the previous classification, it is a more rigorous process of specification, which the main classification criteria and information obtained from the case data rather than subjective judgment.While concerned about the drivering factors of being acquired and both sides integrating factors, we explain why these acquisitions occur and how to reach the deal from the perspective of bilateral interaction.We believe that we specified bilateral driving factors and understand the integrating factors leaded to choose each other, which can help people more fully understand why these merger and acquisition as well as the nature of them.The main conclusions as follow:(1) Whether the acquisition transactions are reached depends on the interaction between the two sides, rather than one side. Only companies being acquired have the strong drive to produce sufficient levels of motivation, can mergers take place. Therefore, we believe that achieving the deal is not "wishful thinking", but the result of the bilateral interaction.(2) We identify the seven main driving factors through the ground theory from the three views of macroscopic, industry and enterprise. There are international economic factor, home country factors, host factor, industrial competition, industry characteristics, enterprise strategy and strategic assets shortage respectively.(3) The merger and acquisitions are varying widely different among them. According to target market and business enhancement, we point out four types, namely horizontal enhancement business in foreign market, vertical enhancement in foreign market, horizontal enhancement business in domestic market and vertical enhancement in domenstic market.(4) From the perspective of being acquired side, we figure out three driving factors respectively international economic factor on macroscopic level, market factor on industry level and enterprises’ plight and strategic factor on industrial level.During the merger and acquisition transactions, being acquired party has the initiative and decision. They will consider a number of factors. The price is far from being the most important, especially when there are many potential buyers.(5) We not only find five dimensions from both sides, namely economic factors, strategic factors, resources, trust and values, but also build a "iceberg" model, emphasizing the "underwater" trust and values are more important than "on the water" economic, strategic factors and resources.