Shandong heavy industry chooses the governance mod

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After "going out", Shandong heavy industry selected the governance mode according to local conditions

after "going out", Shandong heavy industry selected the governance mode according to local conditions

China Construction Machinery Information

"enterprises' going out 'is based on strategic needs, and they cannot' go out 'for' going out ', but should act according to their abilities." Jiangkui, general manager of Shandong heavy industry group, said at the recent special training class on the work of the board of directors of provincial enterprises jointly organized by the state owned assets supervision and Administration Commission of Shandong Province [Weibo] and the Provincial Social Security Fund Council that the successful experience of overseas M & A in recent years was summarized

"the culture, corporate governance structure and legal environment of foreign enterprises are very different from those of domestic enterprises. For the international layout of domestic enterprises, it is necessary to make full preparations, conduct detailed research and formulate rigorous and feasible implementation plans before mergers and acquisitions, and to choose different governance and management structures according to local conditions at different stages of enterprise development after mergers and acquisitions." Jiangkui thinks

after the outbreak of the global financial crisis, the cross-border mergers and acquisitions of Chinese enterprises, which were "bottom-looking", once amazed the world. However, the aura of many M & A enterprises gradually faded due to poor or failed M & A. the "beautiful looking" overseas M & A began to arouse the reflection of Chinese enterprises

many enterprises in Shandong, a large state-owned enterprise Province, have also accelerated their overseas layout after the global financial crisis, but as in the national situation, a few are happy and a few are worried

in this context, the exploration of Shandong heavy industry attracted people's attention

from 2009 to 2012, Shandong heavy industry Weichai group successively acquired France boduan company, Italy Faraday company, Germany Kaiao group and Linde hydraulic. At present, these M & A companies and Weichai have realized resource sharing and coordinated development

"up to now, Weichai has held a total of 37.83 million shares of Kaiao, with a cumulative investment of 1.08 billion euros, a dividend of 11.5 million euros, and a shareholding cost of 28.14 euros per share. Kaiao's current share price is 40.88 euros, the company's book floating profit is about 480million euros, and the return on shareholders is about 45%." Jiangkui said

restructuring through overseas mergers and acquisitions

Jiangkui frankly said that compared with Volvo and Cummins, the latter's business structure and market structure were more balanced and adjusted in the process of structural adjustment, with a significantly higher degree of internationalization. "After the global layout adjustment in recent years, the business structure of Shandong heavy industry is becoming more and more reasonable."

he briefly sorted out the overseas M & a roadmap of Shandong heavy industry in recent years: in january2009, the French economy fell into a trough, and Weichai purchased boduan company for 2.99 million euros. In january2012, the Italian economy was struggling, and Weichai acquired Faraday. In september2012, Germany was trapped in the European debt crisis, and Weichai restructured Kaiao group and Linde hydraulic

referring to the details of the merger and acquisition of Faraday, Jiangkui said that it took more than two years from the initial contact with due diligence, M & a declaration and final delivery after locking the M & a target, and the debt restructuring and equity restructuring are very complex. After the completion of the acquisition in 2012, Weichai group held 75% of the equity of Faraday and was in an absolute controlling position. In 2014, based on faradixin's business plan to turn losses into profits, Weichai group increased its capital by 80million euros, increased its equity ratio to 86.82%, and further consolidated its control

the process of acquiring Kaiao is more complicated. Linde hydraulic under Kaiao is watched by many enterprises because of its leading technology. Eaton group has cooperated with Linde hydraulic for more than ten years and has the right of first refusal, which is the biggest obstacle for Weichai to acquire Kaiao. Finally, Weichai persuaded Eaton to give up the first purchase right through efforts, and the merger and acquisition was smoothly promoted

after the acquisition of Kaiao, Weichai first increased its shareholding in Kaiao to 30%. After Kaiao was listed in Frankfurt, Weichai increased its shareholding in Kaiao to 33.3% on August 16, 2014. In April this year, Weichai further increased its shareholding in Kaiao to 38.25%, becoming its largest shareholder

corporate governance is very different

compared with the difficulty of the M & a process, how to manage overseas companies after the M & A is completed and make them step into the track of healthy development is a more arduous challenge

Jiangkui frankly said that although it is in Europe, the governance structures of Kaiao group in Germany and Faraday group in Italy are very different, mainly reflected in different cultures; The development background of the enterprise is different. Faraday has always been a family business, while Kaiao has experienced the rotation of industrial and financial shareholders, and its public level is stronger; The equity of Weichai in the two companies is different. Faraday is the absolute holding of Weichai and has control over the decision-making body, while for Kaiao, Weichai is the single largest shareholder and is in a relative control position

he explained the corporate governance structure of Kaiao in detail and compared it with that of Weichai. There are many differences between them. For example, the division of labor between the board of supervisors and the executive management of Kaiao is clear and does not coincide, while the executive director of Weichai holds concurrent posts in the board of directors and the management

for another example, the supervisors of the board of supervisors of German enterprises, whether from shareholders or trade unions, make independent judgments and decisions in their own name, and assume the law personally, rather than perform their duties on behalf of shareholders, which is very different from the listed companies in China

in terms of the rights and obligations of the management, domestic listed companies generally have no rules. They hold meetings according to their business conditions and needs and do not need to report to the board of supervisors; The executive management of Keyao will hold a meeting every 14 days, and the CEO must regularly report the company's operations to the chairman of the board of supervisors

the rights of the board of supervisors are also different. The board of supervisors of domestic enterprises has only the right to supervise the board of directors without the right to appoint or remove them; Kaiao's board of supervisors has the right to supervise, appoint and remove the executive management

the structure and responsibilities of the board of shareholders, board of supervisors and board of directors of Faraday are similar to those of Chinese companies, but the specific operation is different. For example, the Secretary of the board of directors of Faraday company is not a statutory permanent post, but is appointed by the chairman of the board of directors before the meeting as required. The company can not adopt the similar domestic fax method to convene the board of directors

there is no best model

"there is no only best model for corporate governance, and human factors are fundamental." Summarizing the management experience of overseas companies, Jiangkui believes that the key is to adjust measures to local conditions and manage according to law

he said that the ownership structure is the basis of corporate governance. The company's equity structure manual hydraulic universal material testing machine mainly adopts a simple high-pressure oil source as the power source, which determines the distribution of the company's control right and the coordination mechanism between the company's owners. When structuring the corporate governance structure, the acquirer should pay attention to the following factors:

first, the local legal regulatory environment. 2. Put the experimental crushed stone and steel ball into the cylinder to understand the rights and obligations under different corporate governance and different corporate forms, such as whether it is necessary to set up a board of supervisors, introduce the power of trade unions, and the different requirements of partnership, limited and joint-stock companies on the governance structure, etc; The second is the management ability of the acquirer, including the management talents, inclusive culture and management demands of the acquirer

the acquirer needs to scientifically evaluate the above factors, and then implement the M & A and equity structure suitable for its own ability. For example, if the acquirer feels that the decentralized equity structure may touch too many stakeholders, the larger the company requires the more governance structure, and it cannot control it by itself, it can choose to wholly control the small company. If the acquirer feels that the obligation of foreign listing is too cumbersome, it should not seek listing before the conditions are met, and should not decentralize the equity structure

in addition, enterprises face different contradictions at different stages of development, so it is not necessary to always maintain a governance and management structure

"for example, when the company is small and dependent on the Chinese side, our main focus is on decision-making efficiency, so the governance structure should try to focus on the simple frame tensile test (stress-strain test) led by shareholders Generally, both ends of the material sample are clamped on two clamps with a certain distance apart. If we have low trust in the management, we can check and balance it by means of rules of procedure, introduction of external supervisors, etc., and give them relatively small rights. If we have a good running in with the management and a high degree of trust, we can appropriately delegate power to the management. " Jiang Kui gives an example

it is worth mentioning that in practice, Weichai appoints senior executives of important overseas subsidiaries as directors (or supervisors) of the parent company to undertake decision-making risks. For example, the CEO of Kaiao, as a director of Weichai Power (29.66, -0.87, -2.85%), is responsible for the decisions made by the board of directors of Weichai, which is also conducive to communication between both parties

Weichai also organized trade unions of overseas enterprises to visit Weichai to strengthen the exchange and integration of grass-roots culture

Jiangkui said that under the reasonable corporate governance structure, the cross-border M & A enterprises of Shandong heavy industry are operating well, and have realized resource sharing and coordinated development with Shandong heavy industry

for example, by making full use of Weichai resources, Faraday established Faraday Asia Pacific Company in Hong Kong and product sales exhibition/experience centers in Qingdao, Shanghai, Sanya and Singapore. In 2013, the Asia Pacific sales orders reached 40million euros, becoming the first in the Asia Pacific market. Before that, the company's Asia Pacific orders were far behind its competitors, only 10million euros

Copyright © 2011 JIN SHI