Completion of Chinese overseas acquisitions: Institutional perspectives and evidence

This study investigates how institutional factors influence the likelihood that Chinese overseas acquisition deals are completed. We argue that a Chinese firm to succeed in a cross-border acquisition is an outcome of the multi-level institutional contingencies. Using a data set containing 1324 announced Chinese cross-border acquisition deals over the 1982–2009 period, the study finds that the likelihood of a Chinese firm to succeed in a overseas acquisition is lower, if (1) the target country has a worse institutional quality, (2) the target industry is sensitive to national security; and (3) the acquiring firm is a state-owned enterprise. In addition, the study finds host country's institutions moderate the effect of the two firm-level factors: the learning experience and state-owned ownership.