Chinese MNEs Ownership Global Strategy: Do Geographical Distance, Market Size, & Regulatory Quality Matter?

This study investigates the cross-border M&As performed by CMNEs in 25 developing countries from 2016 – 2018. Using econometrics approach, this study provides an empirical analysis of the role of geographical distance, host market size, and host government quality on the cross-border M&As performed by CMNEs. We find that geographical distance does not significantly affect the portion of ownership of CMNEs in cross-border M&As. We also find that host country market size and host country regulatory quality significantly influence the portion of ownership of EMNEs in cross-border M&As. Specifically, a larger host country market size and a better regulatory quality of the host country leads to higher portion of EMNEs ownership in their cross-border M&As. These findings contribute to cross – border M&As literature, especially in the context of CMNEs ownership in developing countries. Our study also offers practical implication with regard to the subject matter. Keywords: Cross – border M&As; Geographic distance; Market size; Regulatory qualit