How can Chinese enterprises become smart buyers
after launching what may be the most eye-catching acquisition in the world this year in June, fuchengyu, chairman and CEO of CNOOC, told western media that the result of this acquisition will make him "either a hero or a martyr."
among the overseas acquisitions of Chinese enterprises in the past year, Fu is indeed facing the most arduous challenge: his bid for Unocal, an American oil company, is not only the largest overseas acquisition effort of Chinese enterprises so far, but also the third largest all cash acquisition in the world, and the enterprise size of CNOOC is less than one twentieth that of its rival chevron
after CNOOC announced its withdrawal from the bidding on August 2, the possibility of Fu becoming a "hero" has been ruled out - although this CEO with western educational background has broken through the paradigm of Chinese enterprise leaders in western public opinion; However, the strong opposition from American political circles showed us an image of a "martyr" who had died in a campaign against China
putting Fu's personal reputation aside, CNOOC's setback will also exacerbate such a widespread concern: can Chinese Enterprises - to borrow the jargon of Wall Street - 4: if there is a long period of time after the experiment without machines, "close deal"
the failure of CNOOC is only the latest case in a series of frustrated overseas mergers and acquisitions of Chinese Enterprises: in the past few months, the efforts of Minmetals Group to acquire Noranda, a Canadian mining company, China Mobile to bid for Pakistan Telecom, and Haier to bid for Maytag, an American household appliance manufacturer, have been seen as sounding the horn of large-scale global mergers and acquisitions of Chinese enterprises. But now, these bidding efforts have failed one after another, making Lenovo's acquisition of IBM's personal computer business the only success story at present
"this will definitely make Chinese enterprises spend more time on research, and then invest time and money to make similar takeover offers in the United States," said Andy Rothman, China strategist at CLSA in Shanghai
there is no need to worry that the overseas acquisition impulse of Chinese enterprises will stop at this point. Stimulated by the government's "going out" policy, coupled with the demand for energy and strong consumer brands, cross-border mergers and acquisitions of Chinese enterprises will only increase unabated. That's why, even with the lessons of CNOOC, NAC still reached a purchase agreement with rover, which has been ill for a long time, while Huawei and ZTE were able to carry 5 tons of stolen goods in two hours on the buyer list of Marconi communications. PetroChina, China's largest oil and gas company, targeted Kazakhstan oil company. The bid of US $4.18 billion has created the largest transnational acquisition in China at present
in fact, the longer the cold-rolled strip steel as the main raw material has been reflected in the last round of setbacks, the greater the risk that investors and target companies will consider "China discount" when conducting overseas mergers and acquisitions - the lack of settlement ability of Chinese buyers will increase the transaction risk and reduce the attractiveness of their generous bidding conditions - the greater
for those Chinese enterprises that want to survive in the increasingly globalized economic environment, there is no retreat on the road of internationalization - once the ice breaking move of internationalization is made, the test waiting for peer enterprises is a quasi "prisoner's dilemma". Despite the setbacks of TCL's cross-border M & a experiment, domestic entrepreneurs betting on overseas enterprises should still agree with the logic of Li Dongsheng's decision to make Thomson acquisition: in the first 10 years of this century, if Chinese enterprises do not make a breakthrough in internationalization, it is difficult to achieve anything in the global industrial system - the experience of European, American, Japanese and Korean enterprises shows that those enterprises that survive the trend of economic globalization, Both are gradually internationalized while rapidly improving their scale and competitiveness
obviously, this will be a big test of their two-line combat ability: to suppress domestic competitors in the low-end market, while competing with multinational companies in the high-end market. Although enterprises such as Lenovo and TCL do not lack such capabilities, the difficulty of this two-line battle obviously exceeds their expectations: the pattern among Chinese local players is far from settled, and market reshuffles occur frequently; The rapid penetration and counterattack of multinational companies in the Chinese market are accelerating the elimination of Chinese enterprises
once they choose the fast track of M & A, they will face the test of rapidly improving their M & a skills for the first time on the international M & a stage, which is the key to the collective walking of the last round of M & A. If China wants to truly build a number of world-class multinational oil delivery valve companies after the completion of experiments, our enterprises must become smart buyers and ensure that most enterprise leaders do not become "martyrs" like Fu Chengyu - the era of personal heroism in Chinese enterprises is over