A multinational company wished to implement an investment strategy whereby it increased its control over a Chinese state-owned enterprise (SOE)

Objective

Increase the number of shares owned by the multinational company and secure representation on the SOE board of directors.

Strategy

Communicate the benefits of this transaction to all key stakeholders at the central and local government levels so that the Chinese parties understand the transaction as a win-win situation.

Employ the local government as an ally to lobby the central government ministries approving the transaction

Understand and acknowledge the needs and concerns of the Chinese parties.

Results

An agreement was reached whereby the multinational company’s shares would increase six times their initial amount over seven years.