The third lecture of the fifth KPMG Mentor Class was held successfully——Gains and losses of Chinese enterprises in international growth through overseas M & A
Release date: 19-Oct-2020

At 14:00 p.m. on October 16, 2020, the third lecture of the fifth KPMG Mentor Class of school of economics and management of Beijing Jiaotong University met with the students on time. Mr. Li Jing, partner of KPMG Strategic Advisory Services, was the keynote speaker. He delivered an online lecture entitled "Gains and losses of Chinese enterprises in their international growth through overseas mergers and acquisitions" to the students of the fifth KPMG Mentor class and master degree students in accounting and auditing.

Taking the development opportunities of China's foreign investment as the starting point, Mr. Li Jing predicted that there would still be volatility growth in the future. Chinese enterprises' willingness to expand investment direction and pursue high-quality targets would become increasingly strong, and there would be more space in the future. However, in the process of the development of foreign investment, Chinese enterprises also encountered many problems. It can be said that the past 10 years have been the 10 years for Chinese enterprises to pay tuition fees. Compared with European and American enterprises which regard merger and acquisition as a means of daily operation, Chinese enterprises still inevitably have strategic problems: flocking to follow suit; concentrating investment industries; not knowing the local market and industry; lack of strategy leads to management and control confusion, resulting in difficulties in overseas projects.

Subsequently, the speaker made a systematic analysis on the overseas investment of Chinese enterprises. Vision and goal: to build an enterprise with international competitiveness, considerable scale and efficiency. Three strategies: steady strategy; expanding strategy; cooperation strategy.

Three strategies: strengthen overseas development; focus on group customer development; do a good job in headquarters operation support platform. Six guarantees: brand and service; financial management; risk management; human resources; corporate culture and IT support.

Two aspects: integration and promotion.

Then, the speaker focused on the strategic vision and financial objectives, as well as the market. It also focuses on the nine management links of overseas M & A. The main contents include: transaction subject, transaction process, transaction structure, due diligence, value evaluation, financing scheme, contract negotiation, approval and delivery, and post investment integration.

Finally, based on the theory and case study of overseas M & A, this paper puts forward some suggestions for the development of overseas M & A of Chinese enterprises, that is, to implement international control with Chinese characteristics.

KPMG's point of view: in the process of internationalization, the group management and control should be re-examined in combination with Western practice. International management and control should be "the control of art through scientific management".

In the last exchange session, the lecturer also actively answered students' questions about Chinese enterprises' overseas mergers and acquisitions, including: How can central enterprises balance the risks of avoiding overseas regulatory approval, integration risks after overseas mergers and acquisitions with the opportunities of acquiring high-quality overseas targets? How to view the key of short selling industry of listed companies.

The lecture was a great success under the wonderful and vivid explanation of Mr. Li Jing, and the students gained a lot. The professional knowledge taught by the main lecturer and the explanation of practical cases solved the problem that the current theoretical knowledge and professional skills could not be fully integrated. The students said that they had a further understanding of overseas mergers and acquisitions and other related hot spots, and gained a lot through the combination of theory and practice.