TCL cooperation was founded in 1981 when the Chinese authorities merely implemented their ‘reform and opening-up ‘ policy. The company is located the China ‘s first batch topographic point of reform and opening-up – Guang Dong state. With the advantage of the geographical location and policy, by cooperated with a HongKong company, TCL set up their TCL Communication Equipment Co. , Ltd on 1985, and successfully launched their first telephone in the following twelvemonth. To acquire more control power of purchase and selling, they scraped the cooperation with HongKong company in 1987, and became a independent company. After old ages of attempt, TCL telephone became well-known trade name accepted by most Chinese client in 1980s and 1990s, by the beginning of 90s, TCL telephone achieved 60 % of Chinese domestic market portion, and besides exported to more than 30 states. Subsequently, TCL successfully developed their color Television concern, and had been created another gross revenues myth. With the profound apprehension of Chinese domestic market, great relationship with Chinese authorities, and sufficient operational capital, at the terminal of 90s, TCL marched to the nomadic phone selling, and became the top Chinese Mobile phone manufacturer.
More than 30 old ages subsequently, today, TCL trade name has developed as one of the China ‘s biggest international consumer electronics company. They have broad scope of merchandises in three cardinal countries -consumer electronics, nomadic communications and place contraption. Their operational subdivisions spread in approximately 80 states with more than one 50,000 employees. They market many well-known merchandises in 40 states among five parts with over $ 6 one million millions in one-year gross revenues in 2009. Their trade name value besides exceeded to $ 6 one million millions. TCL extremely recognized by Chinese authorities and people and even the worldwide. They were designated by Chinese Ministry of Commerce as a “ Most Competitive Brand ” in 2007. In the following twelvemonth, they rewarded the “ The Most Valuable Brand List in China ” in New York issued by RREEF.
Acquisition of French Thomson
During the 30 old ages clip, TCL Group started from a little local state-owned concern, now turned into a large international giant, which should acknowledge that it depends greatly on their high-velocity amalgamations and acquisition scheme. From 1996, they acquired the old Hongkong coloring material Television company – Luc group, TCL started their long acquisition journey. By the free transportation of state-owned assets on 1999, TCL acquired Chinese Rainbow telecasting mill in Inner Mongolia to beef up their place as the top Chinese domestic coloring materials Television manufacturer ; During December 2001 and January 2001, TCL acquired Wuxi ‘Rainbow America ‘ Television mill, Zhongshan ‘Suo Hua ‘ air-conditioner mill and Wuxi Permanent electronics companies which mostly help them to spread out their merchandise line into digital merchandise, air-conditioner and etc other than color Television and nomadic phone, on the other manus, those acquisition speed up the enlargement of their production capacity and domestic market.
TCL ‘s International acquisition scheme was get downing with the full acquisition of Germany subordinate Schneider Electric in Munich on 2002 which caused a esthesis in the public both of domestic and international. It has been seen as a successful acquisition, it acquired the trade name ownership which enhanced the TCL ‘s color Television ‘s repute, aid TCL to catch the international particularly the European coloring material Television selling portion, and besides assist TCL to acquire the chance to put up their first European production base. In another twelvemonth, TCL announced the acquisition of Colour Television and DVD digital concern of the Gallic international consumer electronic elephantine -Thomson. Different from the belly-up Schneider Electric, Thomson ‘s color Television portion was figure one in US, and figure two in Europe, the entire gross revenues ranked the figure four in the planetary market. TCL was be aftering to go the top 1 planetary coloring material Television manufacturer through the acquisition by the integrating of Thomson ‘s selling, engineering and supply concatenation. And they were besides intoning the motto that “ turns losingss into additions within 18 months ” . However, the new concern was non traveling good as TCL planed. In the following two twelvemonth after the acquisition, TCL ‘s whole concern has kept losing of in consecutive old ages ; it has been widely considered that the doomed was mostly encumbered by their new acquired European concern. The trade is now widely regarded as a typical illustration of a Chinese company that “ failed miserably in abroad enlargement ” ( Economist.com, 2007 ) .
Case Study of Lenovo acquired IBM Personal computer concern
Founded in China ‘s capital metropolis – Beijing in 1984 with 11 employees, persevered through the invention and attempts, now, Lenovo has grown up into the largest personal computing machine company in China. Up to now, Lenovo has partnered with laptop computing machine, desktop computing machine, and computing machine peripherals while besides providing for pressman, nomadic communications and digital merchandises ( Flash memory, recording equipment, digital image frame ) . At the initial star-up stage, Lenovo has been developing their Personal computer production capableness by collaborating with some celebrated companies such as IBM, HP and etc. Several old ages subsequently, in 1990, Lenovo started to bring forth their ain trade name PC – originally called ‘Legend ‘ . In 1996, Lenovo computing machine became the most welcomed computing machine by Chinese domestic clients.
What made for Lenovo to go a well-known international corporation is the acquisition of IBM personal computing machine ( Personal computer ) concern in 2005 which cost Lenovo $ 1.75 billion. In virtuousness of the acquisition, Lenovo trade name has been fired a well-known trade name in the international market. Now, Lenovo became the 4th largest Personal computer manufacturer in footings of gross revenues volume. Lenovo computing machine are good sold to six continents, the one-year turnover has reached to 16billions in 2009, and has hired more than 20,000 employees all over the universe. Harmonizing to Wu ( 2005 ) , the acquisition has made Lenovo “ doubled ” it ‘s labour size and “ quadrupled its gross ” , and increased Lenovo ‘s capableness to develop, bring forth and market better quality, much more stable and unafraid merchandise and service.
Acquisition scheme – Acquisition mark
It ‘s evidently that TCL were aiming Thomson ‘s advanced engineering in bring forthing color Television and DVD participant ; they hope to better their Research and Develop ( R & A ; D ) capableness through the acquisition, they were besides meaning to research the European market and construct up their ain European distribution web ( Ramstad & A ; Li, 2006 ) . As we discussed earlier, the transportation of engineering, market portion and distribution largely involved the public presentation of the people, because the silent component existed in those transportation procedure. In the freshly acquirer company, Thomson owns 33 % company portion which means the Thomson still have the right to do any major determination. Meanwhile, although there were 9, 000 employees of Thomson joined this new company, but they “ serve as the joint venture ‘s sole gross revenues agent in Europe and North America every bit good as a preferable provider ” ( hypertext transfer protocol: //proquest.umi.com.ezproxy.sussex.ac.uk/pqdweb? index=6 & A ; did=665024041 & A ; SrchMode=1 & A ; sid=1 & A ; Fmt=3 & A ; VInst=PROD & A ; VType=PQD & A ; RQT=309 & A ; VName=PQD & A ; TS=1282674426 & A ; clientId=5646 ) , and Thomson can still maintain its trade name ownership and even rational belongings.
Furthermore, the new company ‘s main engineering functionary was besides assigned by Thomson, non by TCL. Under this administration construction, it ‘s difficult for China side to make the nucleus engineering and chief client because most of the cardinal expertnesss and contacts are from Thomson, they might seek to subconsciously protect their nucleus engineering and client from Chinese co-worker. The main Technology functionary from Thomson is still straight instructed by Thomson company.
Doctor Deng ( 2009 ) had a deep research about the failure of TCL acquisition. He conducted a deep interview with TCL direction degree. One TCL senior director acknowledged that TCL has “ failed ” to gain the “ organisational barriers ” which might act upon the success of the acquisition ( Deng 2009 ) . In here, organizational barrier, he means the different linguistic communication and employee ‘s wage degrees issues.