Analvsis Of The Motivation And Influencing Factors Of China's Cross-border Mergers And Acquisitions Under The Belt And Road Initiative

With the Belt and Road Initiative launched in 2013,Chinese enterprises took advantage of the trend,and seized the opportunities to actively formulate and implement the corresponding internationalization strategy.Overseas acquisitions by Chinese enterprises remained a significant way to implement the Belt and Road Initiative.However,some of the mergers and acquisitions strategies have not achieved the expected results for different enterprises have different motivations when conducting overseas acquisitions.As the important partner along the Belt and Road,the Central and Eastern Europe enjoys a long history and a deep friendship with China.Our industries are highly complementary with each other.In particular,Serbia has been cooperating closely with us in recent years,actively participating in the Belt and Road Initiative and the building of a Community of Shared Future for Mankind.China and Serbia are all-round strategic partners.This study is of great theoretical and practical significance to build a better environment for Chinese enterprises to "going global" and improve the industrial supply chain and market layout to resist industrial shocks,to help Chinese enterprises to actively participate in international division of labor and cooperation to improve international competitiveness.This paper aims at promoting the mobility of productive factors around the world and the resource allocation efficiency in the world,pushing forward economic globalization,building an open economy and actively integrating into the reform and opening up and the Belt and Road Initiative strategy at a higher starting pointThis paper takes Hebei Iron and Steel Group's(HBIS)M&A of Smederevo steel plant in Serbia and the relevant parties of the case as the subject of the research,and adopts industry shock theory and motivations for mergers and acquisitions as the theoretical basis to deeply investigate the formulation and implementation of internationalization strategy and cross-border M&As motives under the industry structural adjustment brought by the industry shock from each relevant policy in the case,The study also examines a series of impacts brought by the M&As on the long-term and short-term performance of companies.The study finds that the restructuring of industries due to industry shocks has led to a greater tendency for firms to develop international strategies and allocate resources globally through M&As,with state-owned enterprises in particular being more likely to be driven by political motivations.After the mergers and acquisitions,there has been great improvement of the performance of the enterprises impacted by the industry in the short term,but in the long run,both business conditions and financial indicators have declined.The research methodology and findings of this paper extend the theories related to cross-border M&As,and provide a reference for Chinese enterprises to correctly assess their motivations for mergers and acquisitions,improve their decision-making mechanism,avoid blind optimism,and formulate realistic future development strategies for new enterprises under the Belt and Road Initiative.On the one hand,this study complements and deepens the theories on the motivations and influencing factors of M&As,analyzes the motivations and influencing factors behind the M&As and summarizes its successful experience,which can provide reference for other Chinese companies going global for overseas mergers and acquisitions.On the other hand,the M&A of Smederevo steel plant was carried out under the background of the Belt and Road Initiative.Taking the national development strategy as the guide and making a comprehensive study of the industry development trend,HBIS Group made a realistic international development strategy based on its own development stage and situation.In practice,a series of overseas M&A activities were carried out.In particular,the acquisition of Smederevo steel plant in Serbia for 46 million euros in 2016 and its subsequent operation and management received high attention and recognition from the leaders and senior government officials of both China and Serbia,as well as wide recognition from the industry.Through mergers and acquisitions,Hebei Iron and Steel Group restructured Smederevo steel plant in Serbia,and brought it back to life.This practical action explored a "model project" to realize complementary advantageous industries,cooperation in production capacity and promote efficient flow of production factors around the world under the international cooperation of the Belt and Road Initiative.It provides Chinese solutions and showing Chinese wisdom for the world.This case is of great significance for Chinese enterprises to "going global" in the future and rely on the national strategy to carry out M&As activities in line with their own reality.In the process of researching for literature on the motivations and influencing factors of M&As,the author found that most of the relevant domestic literature was published in non-core journals,only about 5%of the literature came from core journals.What is more,literature included by CSSCI is still very limited.This reflects that there is still gap in domestic research in this field.More research is needed to enrich domestic research field.The topic of this paper can be regarded as an effective supplement to the research on the field of M&As motives.Hope this study could make a modest contribution to this field.