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The internationalization of Chinese companies: Firm characteristics, industry effects and corporate governance

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  • Kling, Gerhard
  • Weitzel, Utz

Abstract

A prominent issue in the internationalization of Chinese firms is that many are state-owned enterprises (SOEs) and that corporate governance in China is highly idiosyncratic. This paper identifies firm characteristics, industry effects and corporate governance mechanisms that foster internationalization. We find that Chinese cross-border mergers create shareholder value, but not more than domestic expansions. Corporate governance mechanisms matter, jointly and individually. While state-ownership predicts fewer cross-border mergers, a favourable board structure and corporate transparency explains higher M&A returns. As in more mature markets, firm- and industry-specific determinants also affect M&As in China.

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Bibliographic Info

Article provided by Elsevier in its journal Research in International Business and Finance.

Volume (Year): 25 (2011)
Issue (Month): 3 (September)
Pages: 357-372

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Handle: RePEc:eee:riibaf:v:25:y:2011:i:3:p:357-372

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Web page: http://www.elsevier.com/locate/ribaf

Related research

Keywords: Cross-border M& A Domestic M& A Corporate governance Internationalization;

References

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Citations

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Cited by:
  1. Thomas O'Connor, 2012. "Investability, Corporate Governance and Firm Value," Economics, Finance and Accounting Department Working Paper Series n223-12.pdf, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.
  2. Kearney, Colm, 2012. "Emerging markets research: Trends, issues and future directions," Emerging Markets Review, Elsevier, vol. 13(2), pages 159-183.
  3. Gregory, Alan & O'Donohoe, Sheila, 2014. "Do cross border and domestic acquisitions differ? Evidence from the acquisition of UK targets," International Review of Financial Analysis, Elsevier, vol. 31(C), pages 61-69.

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