The <scp>DuPont</scp> financial indicators and the short‐term market performance of Chinese cross‐border M&amp;As: The moderating role of payment method

Feng, Zhao; Siman, Xie

doi:10.1002/ijfe.2012

Cited by 6 publications

(3 citation statements)

References 55 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Furthermore, to prevent the outflow of critical technologies, governments restricted foreign acquisitions in certain high-tech sectors 37 . Additionally, some countries had rigorous review and approval processes for cross-border M&A, potentially involving multiple governmental departments and taking considerable time to finalize, which resulted in delays or even failures of M&A transactions 38 .…”

Section: Theoretical Basis Analysis and Research Hypothesismentioning

confidence: 99%

The influence mechanism of industrial policies on Chinese companies' cross-border M&A decision-making

Shen,

Yang,

et al. 2023

Sci Rep

View full text Add to dashboard Cite

This study explored the potential links between Chinese industrial policy and cross-border mergers and acquisitions by Chinese firms from 2009 to 2019. Based on describing China's industrial strategy and evaluating the then-current situation of Chinese enterprises' cross-border mergers and acquisitions, this empirical study constructed a two-way fixed-effect panel model and an intermediate effect model to assess the mechanism of industrial policy's influence on Chinese enterprises' cross-border mergers and acquisitions decisions. The findings were as follows: (1) Industrial policy could promote the implementation of cross-border mergers and acquisitions of Chinese enterprises; (2) By easing financial restrictions, industrial policy could improve firms' access to capital and encourage cross-border mergers and acquisitions. (3) Industrial policies could promote the high political relevance of state-owned enterprises, thus promoting the success of transnational mergers and acquisitions of enterprises. Therefore, it was significant to promote the transformation of industrial policy from subsidy-oriented to performance-oriented and rationally evaluate the risks and benefits of M&A for enterprises to complete cross-border M&A.

show abstract

Section: Theoretical Basis Analysis and Research Hypothesismentioning

confidence: 99%

The influence mechanism of industrial policies on Chinese companies' cross-border M&A decision-making

Shen,

Yang,

et al. 2023

Sci Rep

View full text Add to dashboard Cite

show abstract

“…Regarding methodology, studies about the impact of M&A on target firms can be categorized by types of measurement as follows: financial and non-financial analysis. Some common financial analyzing methods are stock-market-based analysis (Lin et al , 2020) and accounting-based analysis (Healy et al , 1992; Feng and Xie, 2020). Advantages of financial methods are objective results, the ease at quantifying results, comparability of results over time and the ability of self-computation.…”

Section: Literature Reviewmentioning

confidence: 99%

Financial performance analysis of German firms after Chinese mergers and acquisitions

Fees

Nguyen

Xu-Fees³

2021

RIBS

View full text Add to dashboard Cite

Purpose The purpose of this study is to look at Chinese mergers and acquisitions (M&A) in Germany on a firm level. It focuses on the benefits and risks from the viewpoint of Germany. In this way, the authors want to close the research gap concerning the financial consequences of Chinese takeovers for the affected German firms. The purpose is to find out if Chinese investors show a specific behavior in terms of profitability, growth and business risks in the acquired companies. Design/methodology/approach This paper studies the financial situation of German firms two years before and two years after being bought by Chinese companies, by analyzing accounting data of 19 target companies in six economic sectors. In this empirical study, firm performance is measured by profitability, research and development cost, liquidity and financial leverage. It is using the industry adjustment method and calculation of mean and weighted mean considering company size. Findings Overall, German firms’ financial performance after Chinese M&A did not significantly improve, but they did not worsen either. The changes in financial ratios are different across economic sectors and company sizes. Obviously, the final performance of firms after M&A is quite diverse due to diverse company-specific targets. The results do not reflect common fears about deteriorating situations brought by Chinese involvement drawn in mass media. Research limitations/implications The study lacks analysis for a longer period, ideally five years before and five years after M&A. The calculated results of industry mean may differ from the real industry mean, as components are collected from the sample companies accounting for only 70% of the market. Industry means figures are calculated for only one single point in time and assumed to be unchanged over the whole time period. The study covers mostly firms which have total assets of more than €50m, so SMEs are underrepresented. Practical implications Owners of German firms that are in target but have not been purchased by Chinese investors can see the trends and anticipate which group of M&A targets their firms are categorized into. If their firms belong to the group of sectors or company sizes that shows negative results of performance after Chinese M&A, they can plan to protect their firms by implementing defending strategies against hostile takeovers. If their firms are in the groups that tend to enhance performance after Chinese M&A, they may be in a good position and able to negotiate for mutually beneficial transactions. Social implications The results are important for political and public discussion. It is shown that Chinese acquisitions of German firms do not have a deteriorating effect, at least not in the short-term. Therefore, the results are a good input to neutralize discussions in German society. Originality/value The results disagree with the few previous studies on Chinese M&A in Germany (Bollhorn, 2015; Müller, 2017; Löchel and Sächtig, 2019). While the studies of Bollhorn and Müller are based on subjective methods, the study is based on a detailed financial method. Then, in contrast to the study of Löchel and Sächtig, it is strictly focusing on Chinese/German M&A. Most existing empirical studies are focusing on cross-border M&As from developed to developing countries and there is little attention to acquisitions in the other direction (Ma et al., 2016, p. 22).

show abstract

“…Furthermore, in recent years, some researchers have indicated that there should be cross-border M&As [9]. The corresponding literature has focused on the antitrust review of cross-border M&As.…”

Section: Introductionmentioning

confidence: 99%

Industrial Policy’s Effect on Cross-Border Mergers’ Decisions—Theoretical and Empirical Analysis

Chen

2022

Sustainability

View full text Add to dashboard Cite

To explore the relationship between industrial policy and cross-border M&As in Chinese enterprises, the PSM method and a two-way fixed model were used. Using a sample of A-share listed companies during the period 2005–2019, we theoretically and empirically analyzed the mediating role of financial constraints and the moderating role of political connections between the companies. It was found that industrial policy has a significant positive effect on cross-border M&As and that firms’ financial constraints mediate the relationship between industrial policy and M&As. Political connections moderate the relationship between industrial policy and M&As. This study enriches the research on the relationship between industrial policy and firms’ M&A decisions from a micro perspective, and provides evidence of industrial policy promoting cross-border M&As through alleviating the financial constraints of the firms.

show abstract

The DuPont financial indicators and the short‐term market performance of Chinese cross‐border M&As: The moderating role of payment method

Cited by 6 publications

References 55 publications

The influence mechanism of industrial policies on Chinese companies' cross-border M&A decision-making

The influence mechanism of industrial policies on Chinese companies' cross-border M&A decision-making

Financial performance analysis of German firms after Chinese mergers and acquisitions

Industrial Policy’s Effect on Cross-Border Mergers’ Decisions—Theoretical and Empirical Analysis

Contact Info

Product

Resources

About