Des entreprises chinoises aux
ambitions planétaires
Dominique Jolly, Professor at SKEMA Business
School (Sophia-Antipolis, France), Visiting Professor
at CEIBS (Shanghai, China)
Shanghai, le 5 mars 2015.
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1.The macroeconomic picture
2.Two types of operations
3.Managerial issues
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Foreign Direct Investment (FDI)
“Investment from one country into another
(normally by companies rather than
governments) that involves establishing
operations or acquiring tangible assets,
including stakes in other businesses”
(Financial Times online lexicon, 2014).
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Foreign Direct Investment (FDI)
France
United
Kingdom
USA
Germany
South Korea
中国
India
Japan
Taiwan
Hong Kong
(inward, outward)
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1. The macroeconomic picture
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Inward & Outward FDI (1980-2006)
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How outward
FDI has evolved?
Chinese Outward
FDI
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In 2014, for the first time, Chinese
investment abroad exceeds
investment of foreign companies in
China!
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Examples of big Chinese deals
2005: IBM PCs division takeover by Lenovo
2005: Cnocc fails to acquire United Oil of California
2007: Huawei fails to acquire 3COM (USA)
2008: Industrial and Commercial Bank of China (ICBC) takes 20% of Standard Bank (South Africa)
2009: Zoomlion acquires Compagnia Italiana Forme Acciaio SpA (Cifa) (I)
2010: Geely successfully acquires Volvo (SW)
2012: Bright Food acquires Weetabix (UK)
2012: Xuzhou Construction Machinery Group (XCMG) acquires Schwing Stetter (G)
2012: Weichai acquires Ferretti (I)
2013: Weichai Power acquires Kion (G)
2013: Shuanghui acquires Smithfield Foods (USA) for $4,7 bn
2014: Bright Food acquires Tnuva (Israel)
2014: Sanpower acquires 89% of House of Fraser (UK)
2014: Anbang Insurance acquires New York Waldorf Astoria from Hilton (Blackstone) for $1,95 bn
2014: Hebei Iron & Steel acquire a controlling stake in Duferco (Lux) metal trader
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Entries of Chinese Companies
in Europe
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Acquisitions of French companies by
Chinese companies (2004-2014)
cible française
acquéreur chinois
date de fondation montant transaction
2004Le Cabanon
transformation de tomates
Chalkis
55% du capital = 7 millions d'euros
2007Rhodia Silicones
NFM Technologies
Marionnaud
Moteurs Beaudoin
chimie des silicones
matériel de construction
distribution pdts cosmétiques
moteurs pour bateaux
Bluestar
NHI Group
< 50
2010Château de Viaud
exploitation viticole
Cofco
< 50
10 millions d'euros
2011GDF Suez branche exploration-production
Mc Cormick France
fabrication de tracteurs
Robert Clergerie
chaussures de luxe
Aigle Azur
transport aérien
China Investment Corporation
Yto
Li & Fung
Hainan Airlines
200730% = 2,3 milliards d'euros
< 10
10 millions d'euros
48% du capital
2012Eutelsat
Diva
château Bellefont-Belcier
château Latour-Laguens
communication par satellites
négociant en vins
exploitation viticole
exploitation viticole
China Investment Corporation
Bright Food
Wang (particulier)
20077% du capital = 484 millions $
70% du capital = 30 millions d'euros
estimée à 30 millions d'euros
< 50
2013Manoir Industries
Louvre Hotels Group
Lisieux Plysorol
fonderie
Yantai Taihai
hotelerie (Campanile, Kyriad, etc.) Jin Jiang International
fabrication de contreplaqué
2014Laiterie d'Isigny Sainte-Mère
PSA
production de lait
construction automobile
Biostime (Canton)
Dongfeng
gestion aéroportuaire
Consortium Symbiose (+ SNC Lavalin)
Aéroport de Toulouse-Blagnac
entre 1,2 et 1,5 milliards d'euros
199920% du capital
14% du capital = 800 millions d'euros
49,9% du capital = 308 millions
d'euros
Shandong Hi-Speed Group + Friedmann Pacific Asset Management
Club Méditerranée
Beaugrenelle
centre commercial
Fosun
Safe (State Administation of Foreign Exchange)
897 millions d'euros
700 millions
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Acquisitions of German companies by
Chinese companies (2012-2013)
Date
Sep 13
Sep 13
Jul 13
Jul 13
Jul 13
Jun 13
May 13
May 13
Apr 13
Mrz 13
Feb 13
Feb 13
Dec 12
Nov 12
Sep 12
Jul 12
Jun 12
May 12
Apr 12
Apr 12
Apr 12
Mrc 12
Mrc 12
Jan 12
Jan 12
Jan 12
German Company
Hazemag & Epr GmbH
FLEX-Elektrowerkzeuge GmbH
KSL Keilmann Group
Oerlikon Schlafhorst
Thielert Aircraft Engines GmbH
KION Group GmbH
Kugel- und Rollenlagerwerk Leipzig GmbH
HIB - Trim Part Solutions Bruchsal GmbH & Co. KG
Golden Tulip Hotel (Frankfurt)
PFAFF Industriesystem und Maschinen GmbH
GIW Gesellschaft für innovative Werkzeugsysteme
Degen Maschinenbau GmbH
Viseon Bus GmbH
Aweco Appliance Systems
ThyssenKrupp Tailored Blanks
Intermix GmbH
Solibro GmbH
Carlsson Autotechnik GmbH
Wumag Texroll GmbH & Co KG
Schwing GmbH
HZ FbZ Formenbau Züttlingen GmbH
Drossbach GmbH & Co. KG i.L.
Kiekert AG
Putzmeister Holding GmbH
Saunalux GmbH Products & Co KG
Sunways AG
Chinese Company
Sinoma International Engineering Co. Ltd
Chervon Holding Group Ltd.
ShangGong Gruppe
The Jiangsu Jinsheng Group
AVIC International Holding GmbH
Weichai Power Co. Ltd.
Wafangdian Bearing Group
Ningbo Huaxiang
New Century Tourism Group
ShangGong Gruppe
TQM Tianjin Moto
Suzhou Xinneng Precise Machinery Company
China Youngman Automobile Group Co. Ltd.
Zheijang Sanhua
Wuhan Iron and Steel Group
Sany Heavy Industry Co. Ltd.
Hanergy Holding Group Ltd.
Zhongsheng Group Holdings Ltd.
Yan Siyou
Xuzhou Construction Machinery Group Co. Ltd.
Ningbo Huaxiang Electronic Co.
Dalian Sunlight Machinery Co. Ltd.
Hebei Lingyun Industrial Group Co. Ltd.
Sany Heavy Industry Co. Ltd.
Anhui Saunaking Co. Ltd.
LDK Solar Co. Ltd
Strack V. & Schwarzer M. (2014). Chinesische Investoren – Die neuen Weißen Ritter?. PWC Report.
Retrieved from http://www.pwc.de/de/transaktionen/assets/m-a-review_januar-2014-weisse-ritter.pdf
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We are just at the beginning …
Phase 1. Small size companies
Phase 2. Medium size companies (Volvo,
Putzmeister, Kion, etc.)
Phase 3. Large companies
In 2012, Chinese investments into the EU
accounted for 2.6 % of total FDI flows into the
EU (up from 1.0 % the year before).
Should we be afraid?
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How do you perceive takeover of a
German company by …
… a French company?
… a US company?
15, 8%
22, 11%
31, 15%
27, 13%
19, 10%
Strongly Positive
36, 18%
Positive
38, 19%
45, 22%
Neutral
Negative
Strongly Negative
91, 45%
79, 39%
16, 8%
45, 22%
57, 28%
… a Chinese company?
23, 12%
61, 30%
N = 206
(surveymonkey.com)
Source: Lukas Sobol, SKEMA Business School, Master of Sciences Thesis in International Business.
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What are the possible changes that might
occur after a Chinese acquisition?
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N = 206
(surveymonkey.com)
90
80
70
60
Positive
50
Negative
40
No change
30
20
10
0
Working hours
Wage levels
Working
environment
Job security
Satisfaction of
employees
Other
Source: Lukas Sobol, SKEMA Business School, Master of Sciences Thesis in International Business.
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What are the benefits of Chinese FDI
for the recipient?
For the company:
• Financial Investment
• Access to the Chinese market
• Scale effects with the new owner
• Symbiotic effects with the new owner
For the local economy:
• Job creation
• Spillovers to host country companies:
– vertically (in the supply chain, with suppliers and customers)
– horizontally (with competitors): turn-over of labor force, stimulation of
competition
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2. Two types of operations
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Natural resources or markets?
Natural resource seekers
Market seekers
• Vertical (backward)
development
• Horizontal development
(same activities abroad)
or conglomerate
diversification
• Private companies
• Targets: developed
countries
• Small size
• Large SOEs
• Targets: resource-rich
countries
• Biggest deals until now
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Rational # 1: Give access to
Chinese market
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Rational # 2: Gain access to
foreign technology
Acquired in 2012: 360 million euros
The Chinese “Caterpillar”
- German
- niche-focused:
concrete machine
manufacturer
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Rational # 3: Expand brand
portfolio
Euro 0,4 billion
Euro 1,5 billion
Euro 1,8 billion
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Rational # 4: Capture a good
image
“A Family of Brands You Trust”
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Rational # 5: Market
diversification
Sanpower
89%
2014
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3. Managerial issues
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Problems faced by Chinese companies
in foreign countries
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•
•
•
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Different regulations (French Labor Code, French trade-unions)
Different taxation systems
Currency fluctuations
Country political risks (Sudan, Guinea, etc.)
Unexperienced in dealing with foreign political authorities (CFIUS,
Alstom-GE)
• Lack of trust, rejection, economic nationalism (more than with
greenfield investments), different leadership styles
• Who will be the GM? How to exert management control? How to
recruit?
• How to deal with brands? Towards globalization or localization?
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This presentation will be uploaded on:
https://dominiquejolly.wordpress.com/
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