The ultimate aim of any modern corporate is growth with profit maximization. Growth is the first and foremost characteristic of nature and its products which include modern societies with all their industrial, agricultural and service sectors and above all the research organizations to cater to the needs of primary, secondary and tertiary sectors. Governed by the laws of the universe and nature, societies, markets and above all human life are in the constant churn of development in the realm of creativity and innovativeness.

In pursuit of attaining global recognition, Chinese companies are moving beyond national boundaries. But overlooking cultural differences can imperil their global ambition.

Strong political opposition from some of the US Congress members against government - owned China National Offshore Oil Corp’s (CNOOC) bid to acquire Unocal Corp., one of the world’s leading energy resource and project development companies, on the grounds of threat to national security apparently has put an end to the Chinese company’s dream of expanding to US. It is believed that Chevron, the US oil and gas producer, which was also making a bid for Unocal Corp., derailed CNOOC’s acquisition plan. For Chevron’s bid was $17 bn while CNOOC’s bid was $18.5 bn yet the deal went to Chevron. The US government’s staunch support to Chevron has antagonized China. The treatment meted out to CNOOC by the US can keep other developing nations from investing in the country, and this will be a grave concern for the US. Also, the issue has raised several questions about Sino-US trade relations and global energy security issues.

Chinese companies are on a merger and acquisition spree. Most acquisitions are made by public sector enterprises because unlike with private banks they have easy access to funds from state-owned banks. An attraction behind riding the M&A wave is the advantage that will come with the established distribution channels and brands of the sick company. Chinese companies are using the M&A means to quench their thirst of natural resources, consumer goods and of becoming a global manufacturing hub. M&As will help in accessing cuttingedge technology, diversifying customer base by increasing geographical reach, enhancing operational efficiency, attaining established brand names and enhancing management standards to compete globally. In addition, revaluation of China’s yuan and stagnant demand in the home market is putting pressure on the Chinese economy. Besides, rising wages are also affecting Chinese manufacturers as well as its economic growth momentum. So, it has become imperative that China looks for growth avenues beyond the domestic market.

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