Overseas mergers and acquisitions, focus on the heart

At the end of March, Midea acquired an 80.1% stake in Toshiba Home Appliances Co., Ltd., the main body of Toshiba's home appliance business. Appliance-related patents. Previous Chinese companies' "snake swallowing elephant" moves include: Haier's acquisition of GE Home Appliances, Lenovo's acquisition of Motorola and IBM...

In the first quarter of this year, China set a record for overseas mergers and acquisitions in a single quarter. Under the leadership of a number of well-known companies such as ChemChina, Dalian Wanda, and Qingdao Haier, Chinese companies have become the main force of transactions in many industries. This has aroused endless worries: China's acquisition army, relying on the simple and rude power of "capital", forcibly married "famous ladies" who were desperate and desperate - such a cross-border marriage was doomed from the beginning. It's not so "right match", even if there is a "mountain alliance and sea oath", I am afraid that it is a bit of a scratch, and it is difficult to really touch the other's heartstrings, and it is even more difficult to talk about "two love".

Unachievable goals

The goals of Chinese companies’ overseas mergers and acquisitions are as follows: 1) To obtain technologies and patents from international leading companies in the industry through mergers and acquisitions, in order to seek for the companies themselves on the supply side sublimation and breakthrough; 2) to acquire internationally renowned brands, so as to directly occupy the overseas market, in order to open the situation for the overseas sales of its existing products; 3) to directly introduce overseas products or technologies into China to stimulate and satisfy the constantly upgrading Domestic consumer demand, especially the needs of the growing middle class.

However, with such an astonishing succession of large-scale efforts, Chinese companies may not be able to achieve their goals. We may wish to analyze and observe them one by one.

1. Obtaining technology and patents: Indeed, in some merger and acquisition cases, we can see that Chinese companies can obtain the terms of several technology patents of the other party, but in essence they are more catching "fish" than catching "fish". Take the recent acquisition of 80.1% equity of Toshiba Life Electric Co., Ltd. by Midea Group as an example: Although Midea Group has obtained the right to use the Toshiba brand for 40 years and several related patents, the core technology is still firmly in the hands of Toshiba. In the past year, whether Midea Group can make full use of Toshiba's "rooster" that only lays "eggs", and then develop its own core technology, is the final criterion for this transaction. From this perspective, Chinese companies do not necessarily "eat what they eat"!

2. Occupy overseas markets: Haier's acquisition of GE's home appliance business case occurred at the beginning of the year, a strong motivation is that Haier has never been able to effectively conquer the North American market. This transaction seems to undoubtedly provide a good opportunity for Haier to get closer to US users, and it will also lay a good foundation for Haier's brand to further penetrate the US market. However, the recent behavior of Chinese tourists taking the Japanese market instead of the local market has clearly demonstrated the fact that it is not that China's market consumption demand is weak, but that our supply side cannot provide decent products. From the same logic point of view, the same products will also be "cold" in North America. In fact, the domestic market and the foreign market have never closed their doors to real good products.

3. Introduce foreign products: There is no doubt that the products of the acquired companies will be welcomed by the market when they are brought to China. However, this will also make Chinese companies that attract excellent products from abroad face the phenomenon of "infighting" in which their existing technologies and products have no way out. As a result, they won some parts and lost the whole.

Please bring your leadership

In overseas mergers and acquisitions, Chinese companies often leave with sincerity - we have seen that Chinese companies that conduct overseas mergers and acquisitions will basically immediately Commitment to not easily change the key points of the acquired company's operating team, operating model and culture, so as to maintain its independent operation for a considerable period of time. This is very different from the "killing the chicken and taking the eggs" in which Western companies led by American companies lay off staff first and then sell them in order to seize the residual stock value of the target company. Even so, Chinese companies are always questioned by the local government and strictly supervised by the legal environment in overseas mergers and acquisitions.

Chinese enterprises that are "not bad for money" have become "Trojan horses" in the eyes of many foreign governments or enterprises. In addition, the distrust and non-cooperation of the middle and high-level and core employees of the enterprise will still face the dilemma of "going up" in the local market and not being able to "enter the house". In such a situation of "defense everywhere", Chinese enterprises are more likely to be "receivers" and it is difficult to become a diaosi to achieve "counter-attack".

According to the author's opinion, under the escort of capital, China's acquisition army must also bring the key of "leadership". "Attack the heart and attack the city first! The power of capital can open the "city gate", but it is awe-inspiring; the power of "leadership" can not only open people's hearts, but also shorten the distance from the target, allowing Integrate with each other. In this way, Chinese enterprises can also be "accomplished" and "welcome" by foreign governments and enterprises wherever they go.

Such leadership, at least It should include the following aspects:

1. Cross-cultural empathy: In-depth understanding of the glorious history of the target company, insight into the valuable nutrients in its culture and values. On this basis, a deep understanding of the company's experience The challenges and dilemmas encountered, as well as the emotions and interests of middle and high-level personnel and core personnel.

2. Vision appeal: based on cross-cultural empathy, they can discuss with each other and form an inspiring new mission , a new vision, and draw a second curve to help the other party pull growth at both the organizational and employee levels. The earlier this process starts, the easier it will be to win understanding and support, thereby effectively reducing their large-scale spending Time to wait and see, doubt, and make decisions.

3. Agile learning ability: show sincere curiosity, and actively create various environments and atmospheres that are conducive to communication and learning between the two parties, so as to build on the above two foundations It can quickly and efficiently obtain the full support of the middle and high-level and core personnel of the other party, and even stimulate their "extra efforts", thereby truly bringing about major breakthroughs and progress in "fishing".

By accomplishing the above three points, in fact, Chinese enterprises have achieved the goal of "seeking what they can do if they do not succeed"! In this way, the process of overseas mergers and acquisitions has become a growth journey for Chinese enterprises to "learn from the west", and it is certain that It will take off the "mortal body" and finally achieve positive results.

If not, what is the difference between this massive "westward" movement and "capital drain"? And Chinese banks Isn’t our “rushing valley” in this process a mistake? Only in this way can the overseas “merger wave” of Chinese companies avoid the bleak end of Japanese companies’ “acquisition of the United States” in the 1980s and 1990s. .

In addition to money, Chinese enterprises please bring your sense of mission and responsibility! As a re-rising power, the connotation of the Chinese dream should include a "Chinese-style leadership" experience. Chinese enterprises We should not only be "local tyrants" in wealth, but also "aristocrats" in spirit: when the former leader of the world disappears from sight, we can truly become that calm leader!