Cultural challenges in Chinese/Australian mining mergers and acquisitions - a CEO's perspective

Liang, W., Zhu, Y. and Knights, P. (2012). Cultural challenges in Chinese/Australian mining mergers and acquisitions - a CEO's perspective. In: International Mine Management Conference 2012 Proceedings. International Mine Management Conference 2012, Melbourne, Australia, (251-260). 20-21 November 2012.

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Name Description MIMEType Size Downloads
Author Liang, W.
Zhu, Y.
Knights, P.
Title of paper Cultural challenges in Chinese/Australian mining mergers and acquisitions - a CEO's perspective
Conference name International Mine Management Conference 2012
Conference location Melbourne, Australia
Conference dates 20-21 November 2012
Proceedings title International Mine Management Conference 2012 Proceedings
Place of Publication Melbourne, Australia
Publisher AusIMM: Australasian Institute of Mining and Metallurgy
Publication Year 2012
Sub-type Fully published paper
Open Access Status
ISBN 9781921522758
Start page 251
End page 260
Total pages 10
Collection year 2013
Language eng
Formatted Abstract/Summary
In recent years, Chinese companies have invested billions in Australian mineral exploration, development and processing. In 2008 - 2009 alone, the Foreign Investment Review Board approved $26.4 B of investment. Much of this investment has been by merger and acquisition (M&A) of Australian resources companies.

This paper sets out to investigate how Australian CEOs perceive the cultural and institutional challenges in operating Australia mining companies recently acquired by Chinese interests. Hofstede’s cultural dimensions and institutional theory from management science were used to develop a structured questionnaire, which was subsequently used to conduct telephone interview of the CEOs of six recently acquired mining companies.

Analysis of the survey results indicated that, in all cases, few changes were made to the operational management of the Australian companies post-M&A. The three major benefits for Australian companies as a result of the M&A are the ability to; access long-term debt at lower cost; secure finance for growth plans in financially volatile times; and maintain existing management structures. Some perceived negatives involved longer and more convoluted decision-making as a result of Chinese state approval required for investment decisions.

The study identified building ‘Guanxi’ and an aversion to losing ‘face’ as important cultural learnings for Australian CEOs. Maintaining effective communications is regarded as key for successful cultural integration.
Q-Index Code E1
Q-Index Status Confirmed Code
Institutional Status UQ

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Created: Fri, 08 Mar 2013, 14:00:43 EST by Ms Dulcie Stewart on behalf of Scholarly Communication and Digitisation Service