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ColumbiaUniversity|SchoolofInternationalandPublicAffairs ChinaGoingGlobal–ABoomerangStrategy AStudyofChineseOutboundM&AintheManufacturingSector PresentedbytheSIPACapstoneTeam: YueChenHuilanJordan AlexMetelitsaDiLu FeiQiaoGongpingYang YuhanZhang Advisor:Prof.MeritJanow,ColumbiaUniversityMay8,2012 Introduction WhoistheClient? BusinessDevelopmentAsia(BDA)isaninvestmentbankingfirmthat advisesoninternationalmergersandacquisitions,distressedsituations, privateplacement,capitalraisings,valuationsandfinancialrestructurings. BDAspecializesincross-bordertransactionswithastrongtrackrecord advisingNorthAmerican,European,andAsianfirmsoncross-border transactions. 2 Introduction Whatistheobjectiveoftheproject? Thegoalofthisprojectistounderstandthecurrentlandscapeof Chinesemanufacturingcompanies’outboundM&Aactivities;understand theinternaldriversandbarriersthataffectthesecompanies’decisions whethertoconductgreenfieldinvestmentorM&A;andprojectthefuture trendofChineseoutboundM&Ainthemanufacturingsector. 3 Overview How?Future? What?Why? Macro-levelGovernmentGeneral Size&DriversApprovalTrend Volume • GovernmentProcess Policy• NDRC/Ownership • FinancialMOFCOM/Structure Industry&SupportSAFE/SASACTrend Geography • Foreign• MoreMinority focusReserveIntermediariesHolding Micro-level• InvestmentBanks, LawFirmsand Drivers AccountingFirmsPremium • AcquireTrend Technology/Investment BrandClimate • ExpandMarketOverseas • Obtain ManagementCaseStudiesConclusion Know-how• Successes, Micro-levelfailures&inaction Barriers• LessonsfromCSQ&A 4 Section1:China’sOutboundM&A& #sintheManufacturingM&A 5 ChineseODIvs.theWorldTotal Source:UNCTAD&HSBC 6 ChineseWorldwideOutboundM&A–Manufacturing Numberofdealsbycountryin2005 Source:Dealogic,gis 7 ChineseWorldwideOutboundM&A–Manufacturing Numberofdealsbycountryin2007 Source:Dealogic,gis 8 ChineseWorldwideOutboundM&A–Manufacturing Numberofdealsbycountryin2009 Source:Dealogic,gis 9 ChineseWorldwideOutboundM&A–Ma