First, the main ways for multinational companies to acquire in China through the stock market
At present, there are seven main ways for multinational companies to hold shares of listed companies in China through mergers and acquisitions:
1. Multinational companies purchase non-tradable shares of listed companies in China by agreement. With the separation of state-owned shares, legal person shares and tradable shares in China, it is the simplest and most effective way for foreign investors to purchase non-tradable shares of listed companies by agreement. At present, multinational companies cannot directly engage in A-share trading, so it is difficult to occupy a place in the main board market. On the other hand, in the tradable B-share market, the promoters of listed companies hold most shares, most of which exist in the form of state-owned shares and legal person shares. Therefore, it is unlikely that foreign investors will acquire a large number of tradable shares of listed companies through tender offer. The publication of the Notice on Issues Concerning the Transfer of State-owned Shares and Legal Person Shares of Listed Companies to Foreign Investors provides policy guarantee for the transfer of state-owned shares and legal person shares of listed companies. It can be predicted that a large number of foreign mergers and acquisitions of listed companies will be completed through the acquisition of non-tradable shares by agreement.
2. Multinational companies directly acquire the equity of the parent company of listed companies in China, that is, multinational companies participate in the parent company of listed companies in order to indirectly hold the shares of listed companies. For example, Alcatel (France's world-famous telecom multinational company) bought Shanghai Bell 10% plus 1 share from Chinese shareholders, and at the same time bought out 8.35% shares of Shanghai Bell owned by Belgian companies, increasing its shares in Shanghai Bell to more than 50% (50% shares+1 share). Since Shanghai Bell was transformed from a Sino-foreign joint venture into a foreign joint-stock company, its 25.64% equity of Shanghai Bell, a listed company, was also transferred to Alcatel Shanghai Bell, a joint venture company. In this way, Alcatel not only broke the ban that foreign investors cannot hold shares in the telecommunications field, but also achieved the goal of holding shares in listed companies. The biggest advantage of this method is that it avoids the existing policy restrictions. Therefore, the merger and acquisition of listed companies in China by multinational corporations will become a mainstream mode.
3. Listed companies in China issue additional shares to multinational companies. Private placement is an internationally accepted backdoor listing mode, which refers to the acquisition mode in which listed companies obtain high-quality assets of the acquirer through private placement of new shares to the acquirer, while the acquirer injects high-quality assets into the listed company, it gains control by acquiring newly issued shares of the listed company. After the promulgation of the Measures for the Administration of the Acquisition of Listed Companies, the CSRC successively issued some supporting documents related to the acquisition of listed companies, including the Pilot Opinions on the Assets Replacement of Listed Companies (i.e. Directed Issuance), which made the non-market M&A and the shoddy reorganization lose their foundation and adjusted the profit distribution pattern in the M&A and reorganization of listed companies. The author believes that the introduction of private placement will greatly change the current restructuring mode of listed companies in China and eliminate some institutional obstacles in the restructuring of listed companies in China.
4. China listed companies issue convertible corporate bonds to multinational companies. This model has always existed in China, such as the extraordinary shareholders' meeting held by Tsingtao Brewery Company on June 23rd, 2003. The proposal of the Strategic Investment Agreement signed between the Company and Anheuser-Busch Company (AB Company), the world's largest beer giant, and the proposal of approving and agreeing that the Hong Kong Securities Regulatory Commission will grant Qingdao State-owned Assets Office, Anheuser-Busch and their respective concerted actors an exemption according to the Code of Takeovers and Mergers of Hong Kong Companies, allowing them to buy all the issued shares of the company without making a compulsory takeover proposal were passed. This indicates that the necessary legal procedures for Tsingtao Brewery Company to issue convertible bonds to AB Company have been basically completed. According to the agreement, it began to issue convertible bonds to AB Company in March 2003.
5. Multinational companies first set up joint ventures with listed companies in China, and the assets of listed companies are acquired by the joint ventures in reverse. Reverse takeover refers to the behavior that the acquirer sells the assets to the acquired party and pays the purchase price in whole or in part with the cash paid by the acquired party. In reverse takeover, the ultimate intention of the acquirer is to buy enough shares from the controlling shareholder unit to dominate the acquired party in management, and the acquired party and its controlling shareholder unit are also willing to be acquired from the perspective of strategic and industrial adjustment. Reverse merger and acquisition is actually a transaction. Unlisted companies buy and control the major shares of listed companies before the merger, and then the unlisted companies are reorganized into a new board of directors and control the board of directors. This transaction can be completed in a short time, and the result is that the unlisted company becomes a listed company. For example, in April of 20001year, Michelin Group invested 200 million US dollars to establish Shanghai Michelin Warrior Tire Co., Ltd. with 70% of Michelin's shares. After that, the joint venture company spent $320 million to acquire the core business and assets of the tire and rubber company in reverse.
6. Overseas subsidiaries of China enterprises or overseas "window" enterprises acquire shares of domestic listed companies. A series of acquisitions of domestic listed companies by China Resources Group are typical of this model. China Resources Group is a famous "window" enterprise established in Hong Kong. From June 65438 to June 0999, China Resources Group adjusted its property right structure, and China China Resources Corporation became a wholly-owned holding company of China Resources Group, exercising its holding function. On June 20th, 2000, China China Resources Corporation acquired 8. 1% equity of Vanke at one time, and its shareholding increased to 10.8%, becoming the largest shareholder of Vanke. On June 30th, 2000, Xuzhou Weiwei Food & Beverage Co., Ltd., a subsidiary of Wufenghang (China China Resources Corporation), was officially listed on the Shanghai Stock Exchange. In September of 20001year, in the name of China China Resources Corporation, China Resources acquired 5 1% shares of Sichuan Jinhua at a cost of1500 million yuan, becoming its absolute controlling shareholder. In the field of medicine, China Resources Group has signed a letter of intent for joint venture with Northeast Pharmaceutical Group, and Hong Kong China Resources will hold Northeast Pharmaceutical Group, thus indirectly holding the listed company Northeast Pharmaceutical, which is currently in the asset evaluation stage. At the beginning of 5438+February 2002, China Resources Group won 86.98 million shares of ST Ji Fa state-owned legal person shares for 200 million yuan, which will replace Ji Fa Group as the new controlling shareholder of ST Jifa. The large-scale cross-industry acquisition of China Resources in the Mainland has formed the "China Resources Department" of China's capital market.
7. M&A activities conducted by multinational companies through the acquisition of overseas circulating stocks (such as B shares, H shares and N shares). ) or other financial innovation models will also become a bright spot in the M&A market, and such innovative models will have more room for imagination.
Second, the main ways for multinational companies to acquire in China without going through the stock market
There are eight main modes for multinational companies to conduct mergers and acquisitions in China without going through the stock market:
1. Multinational companies directly acquire China enterprises as a whole. Overall merger and acquisition refers to the overall transfer of assets and property rights. Generally speaking, the overall M&A will only happen when the strength of the acquirer is very strong and the strength of the acquired party is quite different. There is no doubt that the strength of multinational corporations is vastly different from that of China enterprises, so the overall mergers and acquisitions of China enterprises by multinational corporations occur from time to time. The most typical model is the "China Policy Model". 10/2 in April, 1992, Hong Kong China Strategic Investment Company (hereinafter referred to as China Strategic Investment Company, renamed on the basis of a Hong Kong listed company in June) acquired Shanxi Taiyuan Rubber Factory, which initiated the merger and acquisition of foreign capital in China after the reform and opening up. In the following two years, the M&A activities of Zhongce Company in China were often unexpected. 1in may 1992, zhongce company acquired 37 state-owned enterprises in Quanzhou, Fujian province; 1September, 1992, Zhongce Company acquired all enterprises owned by Dalian Light Industry Bureau and established 102 joint venture company. China Strategic Company has also established dozens of holding joint ventures in Hangzhou, Ningbo and Wuxi. The M&A investment of Zhongce Company in China reached 3 billion yuan, which caused great repercussions at that time and was called "Zhongce phenomenon".
2. Multinational companies directly merge with enterprises in China or form new joint ventures with enterprises in China. Partial merger refers to the partial transfer of assets and property rights. Generally speaking, some mergers and acquisitions often occur when the strength gap between the acquirer and the acquired party is not big. The formation of joint ventures can also be regarded as a special type of partial mergers and acquisitions. This type of M&A is the most common form of M&A for multinational companies in China.
3. In a Sino-foreign joint venture, the foreign party obtains Chinese shares. The model established by Hu Feng (2003) proves that the constant mutual understanding and learning between the two parties to the joint venture is the root of the structural instability of the joint venture. At present, a large number of Sino-foreign joint ventures generally have endogenous structural instability, which will eventually come to an end. The most important way to end the joint venture is that one party of the joint venture is acquired by the other. Multinational companies entering China have long-term strategic goals, while China joint ventures mainly play games against short-term utility functions. Foreign investors in joint ventures have a strong learning tendency and their learning ability is much stronger than that of Chinese investors in joint ventures. Once the foreign supervision technology reaches a critical point, the foreign party of the joint venture will show a strong preference for acquiring the joint venture and gain control of the joint venture. There are two main ways for foreign investors in joint ventures to acquire Chinese equity in joint ventures. The first is the acquisition when there is capital increase; The second is the acquisition without capital increase. It should be noted that there are quite a few joint ventures in China, which is the product of China's strict restrictions on multinational companies entering this field. With the gradual fulfillment of China's commitment to the world, the termination of the joint venture will be further accelerated. At present, the tendency of "sole proprietorship" of foreign capital in China is an obvious example.
4. Acquisition of China enterprises by subsidiaries or joint ventures of multinational companies in China. For example, on February 20th, 2002, 65438, Shanghai GM (a joint venture between SAIC and GM), SAIC and American GM jointly acquired 0/00% equity of Shandong daewoo motor Parts (Yantai Body Co., Ltd.). In the new joint venture company established after the reorganization, Shanghai GM became the largest shareholder with 50% of the shares.
5. M&A activities of overseas listed companies or China enterprise window enterprises in mainland unlisted companies. For example, China Resources Venture Brewing Co., Ltd. 1994, a subsidiary of China Resources Group, acquired Shenyang Beer. By the end of 2002, China Resources has acquired more than 20 breweries in the Mainland, especially after the acquisition of Wuhan Donghu Brewery in 2002, the production scale of China Resources Beer has been in the leading position in China beer market.
6. Multinational companies reorganize their branches in China. The restructuring of Unilever's subsidiary in China is undoubtedly a very typical example. Unilever established Shanghai Lihua Co., Ltd. with Shanghai Soap Factory and Shanghai Daily Chemical Development Company on 1986. Limited by the laws and regulations of Sino-foreign joint ventures at that time, Unilever's expansion in China continued the joint venture model of Shanghai Unilever. By 1999, the number of joint ventures of Unilever in China had surged to 14. In order to effectively organize and manage enterprises in China, Unilever set off a subversive adjustment that year and divided its business in China into three parts. After the reorganization, 14 enterprise not only merged into Unilever's holding company, but also began to merge into four clear legal entities. At that time, the restructuring effect of Unilever was remarkable, the operating cost decreased by 20%, and the number of foreigners was adjusted from/kloc-0 to less than 30. In order to organize and manage enterprises in China more effectively, Unilever set off a new round of adjustment in 2002.
7. Mergers and acquisitions between the parent companies of multinational corporations indirectly lead to mergers and acquisitions between their subsidiaries in China. For example, on May 7, 2002, HP completed the acquisition of Compaq, and the combined company will become the world's largest computer and printer manufacturer and the third largest technical service provider. Since both HP and Compaq have their own subsidiaries in China, after the merger of HP and Compaq, their subsidiaries in China also entered the merger schedule.
8. The subsidiaries of multinational companies in China sell assets to other multinational companies. This pattern also happens from time to time in our country.
Three, multinational companies in China's mergers and acquisitions in the future possible innovative models.
In addition to the existing models, multinational companies will have more innovative models in M&A in China. The innovative models that multinational companies may adopt in the future mainly include:
1. Multinational companies acquire shares of listed companies in China as qualified foreign institutional investors. The entry into force of the Interim Measures for the Administration of Domestic Securities Investment by Qualified Foreign Institutional Investors undoubtedly provides the possibility for multinational companies to directly enter the China A-share market. In the future, multinational companies will enter the China A-share market as qualified foreign institutional investors.
2. Multinational companies can acquire non-tradable shares of listed companies in China through auction and creditor's rights. Many major shareholders of listed companies in China have been sued for failing to pay off their due debts, and their mortgaged company shares will be auctioned through the compulsory execution procedures of the people's court. Multinational companies can obtain shares of the corresponding listed companies through the auction market. However, it should be noted that foreign investment in the auction market requires certain conditions (see Article 33 of the Auction Law).
3. Multinational companies indirectly acquire China enterprises through the creditor's rights market. It is possible for multinational companies to indirectly acquire equity by acquiring the creditor's rights of listed companies, that is, "debt-to-equity swap". This M&A model is very popular in foreign M&A markets. Many investment companies will buy the creditor's rights of the target company at a low price, and then convert the creditor's rights into equity by restructuring the target company, and then sell the equity after the business situation of the enterprise improves, thus obtaining huge profits. This M&A model is also supported by the domestic legal system. For example, Huarong Asset Management Company, in order to revitalize its assets, has begun to package and sell non-performing claims to investors including foreign investors. Therefore, the involvement of foreign capital in these bad debts is helpful to directly obtain the equity of domestic listed companies.
4. Multinational companies come forward to collect agency rights and gain control of China enterprises, but this way can only play a role in gaining control of the company in the short term. In the past, domestic institutions generally collected agency rights. In the future, there will be cases in which multinational companies collect agency rights, because there are no special restrictions on multinational companies in the law of collecting agency rights. Multinational companies can hold a part of the equity first, and then make an offer by virtue of their shareholder status to solicit the right of entrustment. After success, they can reorganize the board of directors according to their own wishes, implement their own business strategies, and lay the foundation for future substantive acquisitions. For the industries that restrict the share of foreign capital in China's WTO accession agreement, this kind of agency dispute is more meaningful to multinational companies.
5. The ways in which listed subsidiaries of multinational companies absorb and merge China enterprises. With the gradual opening of China's capital market to foreign-funded enterprises, it is expected that the subsidiaries of multinational companies will be listed in China, so a new M&A model may emerge, that is, the subsidiaries of multinational companies in China will absorb and merge other listed companies or unlisted companies. However, due to the high listing threshold of foreign-funded enterprises (for example, if the profit is three years, it needs to be listed as a whole to prevent divestiture and bundling, and it needs a one-year listing counseling period, etc. ), the emergence of this model will take some time.
6. Listed companies in China entrust multinational companies to combine stock custody with option plan. In April, 20001year, Ningxia Hengli publicly collected equity transferees for overseas investors, and planned to introduce overseas shareholders by entrusting management of equity and signing the Agreement on Forward Transfer of Equity, but it was suspended due to policy reasons. However, with the further relaxation of relevant policies in the future, this model still has room for operation.
7. Multinational companies offer to buy listed companies in China. Tender offer refers to the acquisition of shares of listed companies by multinational companies through the secondary stock market, so as to achieve the purpose of mergers and acquisitions. Because the ownership structure of China stock market is divided into tradable shares and non-tradable shares, it brings great inconvenience to tender offer. With the promulgation of the Administrative Measures for the Acquisition of Listed Companies in July, 2002, the A-share market in China has been further opened, and this model will become popular.