Analysis Of Risk And Prevention Of Chinese Enterprise Overseas Merger And Acquisition

Since China undertook the economic reform and open to the outside world, China had received huge amounts of investments. In addition, China experience rapid economic growth with the help of advanced technology, excellent human resources and remarkable management systems. At present, Chinese enterprises are not only trying to appeal the foreign investment, but also being the foreign investors. They actively conduct overseas expansion. The statistics showed that in the coming years, the total foreign investment would exceed the total foreign direct investment. Therefore, it is critical to review how these Chinese enterprises implement "going out" strategies. Merge is one of the strategies but recent studies demonstrated that there are little Chinese organization successfully merger foreign corporation. This paper will explore the reasons behind this. It views some basic theories of the overseas mergers and acquisitions and associates those theories with Chinese enterprises overseas mergers and acquisitions. We seek to help these firms to find out the opportunities and risks in overseas acquisitions. We also put forward effective solutions to conquer these risks. This paper will mainly use a classic acquisition case, "ShuangHui Merge SFD " to conduct the case study.