Foreign Managerial Embeddedness And Transition Of “Joint Venture-losses -Merger&Acquisition ” In The Alliance Between Chinese And Foreign Enterprises

Along with the tide of global integration rapid setting off and the stride of China’s reform and opening up policy great carrying out, Muti-national Corporations’ direct investment has also become increasingly popular.However,the direct investment in such a considerable portion is experiencing from early days of joint venture,to mergers and acquisition,even to sole proprietorship.In the perspective of space,foreign enterprise expands its equity based on original holdings,owning the JV.;From the duration point of view, foreign enterprise accelerates possession in the use of “loss”,with mutual learning as a part to learn.Therefore,foreign corporations acquire Chinese corporations through the path of “joint venture-losses-M&A” on the one hand,not only increasing transaction costs of Chinese corporations and the cost of Chinese corporate learning,but also occupying Chinese corporate survival space by conspiratorial loss;on the other hand, endangering host country’s industry security and damaging the healthy and orderly development of the host country’s economy.Based on above,the study analyzes driving factors of foreign corporate holdings’ change,combining with perspective of network,on the back ground of “joint venture-loss-M&A” called transition of foreign corporate holdings. Lu Changchong and colleagues find “joint venture-M&A” being driven by “conspiratorial loss” which is always ambiguity.In the analysis of“conspiratorial loss”,we also find an interesting driving factor being named foreign managerial embeddedness,that is foreign managerial double embedding properties including managerial structural embeddedness and managerial relational embeddedness.Foreign managerial structural embeddedness mainly manifests managers possessing the center position of alliance network,affecting the whole structure network;foreign managerial relational embeddedness primarily appears as managers owning the edge position of alliance network, influencing auxiliary and information exchange. Thereby, foreign managerial double embedding properties has directly determined transferring information, manufacturing information and distorted information in the alliance network, however "conspiratorial loss" is also just one way to drive "joint venture-M&A".Consequently,the article builds some driving connections between managerial embeddedness and foreign holdings’ change.From the dialectical point of view, driving connections exist in duration and space,namely time and equity change of foreign corporate holdings.Thus,this paper firstly explores essence of transition of “joint venture-M&A”in the distinction between “normal loss” and "conspiratorial loss",combining with the perspective of “openness network” and “closed network”.Secondly the study constructs mechanism model of managerial double embedding properties and “joint venture-loss-M&A” change and analyzes the reason for formation of managerial double embedding properties’ driven factor,starting with relationship between managerial embeddedness and "conspiratorial loss".Finally,in the perspective of dynamic,this paper finds out that the structural embeddedness is much more obvious,but relational embeddedness is lower for observing managerial double embedding properties to the influence of foreign holdings’ change in the foundation of the data of China’s listed Sino-foreign joint venture in1999-2012,with consideration of time change and equity change at the same time.Ownership concentration can reduce relationship between structural imbeddedness,relational imbeddedness and holdings’ change. Thereby,the research searches a driving path of “joint venture-M&A” in order to prevent future path from “joint venture-loss-M&A”, and even provide decision-making reference and the way to reverse absorption.Three innovations from the study following:(1)the study firstly proposes the notion of managerial double embedding properties,and finds managerial double embedding properties having influence to the information flow in the network;(2)the research can more practically,scientifically,effectively explain changing path of “joint venture-loss-M&A” for making managerial double embedding properties as driving factor,overcoming abstract characteristics of “conspiratorial loss”.(3)This article simultaneously considers time change and equity change creatively as factor of foreign holdings change,with materialistic philosophy of dialectical thought.