Gaining from the Global Ambitions of Emerging Economy Enterprises: An Analysis of the Decision to Sell a German Firm to a Chinese Acquirer

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This paper examines the issue of cross-border acquisitions by companies from emerging economies in industrialised countries: an important phenomenon that has recently found increasing emphasis in international business research. In analysing Chinese acquisitions of German firms in the machinery and equipment industry, the paper addresses the question of why firms from industrialised countries are sold to companies from emerging economies. Several real and imagined reasons may induce the German side not to sell; nevertheless, this type of acquisition occurs with increasing frequency. Using case study evidence and interview data, the study finds explanations for the decision to sell to a Chinese company. The results show that German firms can gain substantially from the global ambitions of the Chinese firms for advancement of their own business objectives. This is due to omplementarities in the motivations for engaging in the deals, as well as the underlying strategic needs of both firms. In addition, the specific nature of the cooperation between both firms instils in the German managers a sense of control and security—either real or merely perceived—creating conditions that are favourable to the selling decision. Most importantly, in the context of emerging economy enterprises acquiring advanced economy firms, motivations on both sides of the acquisitions appear to go beyond the commonly known goals such as capital transfer and additional market access, as the acquisitions provide the companies involved with conditions favourable to expansion into previously inaccessible market segments. The findings of this study provide useful guidance for the development of future strategic relationships between firms from industrialised and emerging economies.
Original languageEnglish
Pages (from-to)177-191
Number of pages15
JournalJournal of International Management
Issue number2
Publication statusPublished - Jun 2010


  • Cross-border mergers and acquisitions (M&As)
  • Foreign direct investment (FDI)
  • Emerging markets
  • China
  • Germany
  • Competitive strategies of non-emerging market firms for emerging markets
  • Case study


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