Study On M&A Target Enterprise Selection

Cross-border M&A is the main driven element of economic globalization, large scale cross-border M&A transaction can even change the global industrial landscape and promote industry evolution. The primary issue for acquirer to start a cross-border M&A transaction is to find a proper target enterprise as per screening. It is stated that’Choice is greater than efforts, the right choice is half the battle’, target company selection is critical in M&A, especially for cross-border M&A transactions. Thus, improvement of the target selection accuracy will play an important role to ensure M&A successful.ChemChina group targeting to acquire the world leading agricultural company Syngenta case caused tremendous repercussion nationally, due to the transaction will involve development of GMO product commercialization in China, also for the huge transaction value. Meantime, the agricultural industrial is experiencing depth restructuring, major market share companies are seeking for M&A opportunities to achieve the business and strategic development. The acquisition agreement between ChemChina and Syngenta has encountered tortuous negotiations. The case is worth for deep analysis and researches.The main content of the article:based on M&A target enterprise selection theories and case introductions, the author chose ChemChina strategic development angle to analyze M&A target direction. Then view both merger and mergee as a whole to analyze its compatibility. At last, the author studied the M&A expecting synergies, and concluded that both parties can achieve strategic complementary and better advantage in resources, so that the combined company can better adapt to external environment and provide positive impact to their stakeholders.The significance of the article is to provide a few analytic views to the enterprise especially the state-owned enterprises for their cross-border M&A activities. The state-owned enterprises endowed with national industrial development strategy, therefore, the success of their cross-border M&A activities also promote national industrial development goal. Most of the relevant literatures did not study the subject via an intact case, this article summarized some key gains from case study and wish to provide a few analytic views.