On the Bing Fa Mou - Haier merger strategy.docVIP

 PAGE \* MERGEFORMAT 3 On the Bing Fa Mou - Haier merger strategy From 1988 to 1997 to 9 years, the Haier Group in Qingdao merger electroplating factory, air-conditioner factory, freezer plant, Red Star Electrical Factory, Wuhan, the Greek island of companies, 15 enterprises. 1997 was the annexation of Haier in China, the year, has merged with Guangdong, Guizhou, Anhui and other provinces of the six companies. Through a series of mergers and acquisitions, Haier invigorated the nearly 20 billion in stock assets, initially completed the Group’s industrial layout and regional distribution, and achieved significant economic benefits. Past five years, the Haier Group’s industrial sales of an average annual rate of 69.1% increase in 1997, breaking 10.8 billion for the next century into the world top 500 goals laid a good foundation. Market economic conditions, enterprise mergers are risky capital movements, Haier, who after years of groping, has summed up to form a set of full use of their own advantages in order to make an inventory of tangible assets, intangible assets, to Haier management, and cultural patterns, save loss-making enterprises acquisition strategy, in previous mergers, the Tried and tested. One strategy: Enter the management mode, wake-up ‘shock and Fish’ Haier selected acquisition targets with unique features: The main choice of technology, equipment, personnel quality are excellent, but poor management in a shock loss-making state enterprises, Haier would call it ‘shock the fish to eat’. Haier select ‘shock and Fish’ is based on two considerations: First, the system that is not so effective good corporate mergers have not been the driving force, a truly powerful combination of capital as the bonds in the domestic conditions are not ripe; secondly, lack of funds so dominant enterprises unable to mergers and those in need of huge investment in loss-making enterprises. In China, the company a loss of a variety of reasons, but the mechanism is not