Study On Cross-Border Mergers And Acquisition Performance From China’s Enterprises

With the high speed development of China’s economic level,the level of Chinese enterprises’ international competitiveness is also in constant rise.Because of the going-out strategy,Chinese enterprises OFDI scale is constantly expanding,the number of transactions,transaction amount and scope are showing a significant growth trend.And the Cross-border M&A has become a bright star of China’s OFDI.This study is based on two point,M&A performance and institutional distance.And institutional distance can be divided into formal institutional distance and informal institutional distance.In order to provide theoretical and practical guidance about Cross-border M&A to Chinese government and enterprises,this paper explores the logical relations between M&A performance and institutional distance.According to the principle of Cross-border M&A,this paper collects 168 samples of Chinese listed companies in Cross-border M&A between 2011 and 2015.Meanwhile,this paper takes formal institutional distance and informal institutional distance as independent variables which are belong to institutional distance,and takes the M&A performance as dependent variable.Finally,this paper uses the principal component analysis and multivariate linear model to explore the relationship.The empirical results suggest that formal institutional distance and informal institutional distance have a positive impact on the long-term M&A performance which means Chinese acquirers have a higher performance on the country which has a higher formal institutional distance and informal institutional distance compared to China.High quality system environment of host country and synergistic effect of cultural fusion makes the enterprises after the merger can make full use of these unique advantages to speed up the development and accelerate the integration,which has certain positive influence on M&A performance.And there is no obvious relationship between the institutional distance and short-term M&A performance.Because institutional distance is a long-term factor for a M&A project,it takes time to impact the M&A performance.In accordance with the conclusion,this paper finally comes up with some advices for the government and enterprises.