At Doing Business Globally in New York this afternoon, panelists in our Emerging Markets track session discussed regulatory changes, M&A outlook and common mistakes related to doing business in China.
Baker & McKenzie panelists included Howard Wu from Shanghai, Grace Tso from Hong Kong, and Skip Rankin from New York.
Some key takeaways:
- The economy is slowing in China, but still growing. What China may consider a minimally acceptable rate of growth, is very acceptable in a more developed economy.
- Overall, China has a much tougher compliance environment than in the past.
- The government’s new fast-track merger control review speeds up processing time (from 4-6 months to 30 days) for mergers and acquisitions that don’t raise competition concerns.
- There has been significant growth of privately-owned companies in China in the last 5-7 years. The three largest privately-held companies in China account for a huge portion of the country’s M&A deal activity.
- Some common mistakes made by foreign companies doing business in China include: over-reliance on agreements, not enough awareness of employment activism, not enough personnel on the ground, insufficient due diligence and compliance pitfalls.
Baker & McKenzie partners Alan Zoccolillo and Michele Maney led a discussion this morning at Doing Business Globally in New York on winning strategies in cross-border deals, taking attendees through eight key transaction elements, from kick-off to closing. The session drew a standing-room only crowd.
Some tips from the discussion:
- Set up a formal kickoff meeting, which can be useful in setting up parameters of the deal.
- Proactively manage the deal through all of its elements. This gives everyone involved more comfort to have someone in the role of project manager, keeping track of every aspect of the deal – milestones, timeframe and goals.
- Bring the entire deal team into the process early. Think about, what do I need for this deal, who in my organization is going to be involved?
- Analyze all potential deal structures, and jointly select the best overall approach. Cross-border deals present an opportunity to mix and match deal structures in certain cases.
- Make anticorruption diligence a fundamental component of diligence investigation.
- Prior to closing, identify and address the most likely post-closing disputes.
- Don’t wait until closing to start integration planning.
Mike Walsh, CEO of the legal business of LexisNexis, delivered the keynote address at Doing Business Globally in New York this morning, highlighting five considerations for global business leaders.
- Build Leading Positions in Attractive Markets: Companies must prioritize certain emerging markets over others for growth opportunity. Consider: How big is the market opportunity and how fast is it growing?
- Innovate to Meet Evolving Customer Needs with Global Infrastructure: Recognize that customers in different markets have different needs, and customize products to best suit what they are looking for. Mr. Walsh referenced LexisNexis’ creation of Lexis for Microsoft, which allows users to access LexisNexis without leaving their document window. The software has a different name in different locations, but the general platform remains the same.
- Optimize Global Workforce & Assets to Bring Maximum Value to Your Customers: To deploy the best talent, you must do so globally. Mr. Walsh referenced the global locations of the LexisNexis legal, engineering, content, customer support and editorial teams.
- Continuously Measure & Improve Focus relentlessly on customer needs. Build a culture of rigorous performance and management, and continuously measure it.
- Build a Strong Culture with a Higher Purpose: Mr. Walsh described LexisNexis’ Rule of Law Now initiative, and its efforts in Myanmar and other developing countries to advance the rule of law worldwide. Efforts like this build a strong company culture with a higher purpose.
Read more about Mike Walsh / Follow @LexisNexis on Twitter.