After some small talk during an initial meeting, a Norwegian put out tobacco and cigarette paper to make a cigarette and handed it to a Chinese entrepreneur.
The Chinese took the cigarette, lit it and became intrigued. The Norwegian then embraced the entrepreneur.
That was how a Chinese company acquired a Norwegian company. The entrepreneur, Ren Jianxin, is general manager of ChemChina.
The Norwegian is the labor union chairman of the acquired company.
This is only one of its overseas mergers and acquisitions (M & A) in recent years. M & A allows domestic companies to acquire resources, marketing, talents, and technology in a quicker manner.
ChemChina has brought in 1,000-plus patents, accounting for more than a third of all patents it owns through mergers.
The company has improved its technical strength in poly-silicon, organo-silicon, methionine, pesticides and other areas.
Ren Jianxin said the country still faces great challenges. Domestic companies must go global. Mergers and acquisitions can generate faster innovations and lower costs.
Yet not all Chinese entrepreneurs enjoy as much luck as Ren Jianxin. Some companies encountered M & A refusals or blockades, but Chinese companies have a "trump card," local innovations.
ChemChina is raising its R & D investments that could reach 7 billion yuan per year by 2015, accounting for 3.5 percent of total sales revenues.
China Bluestar Chengrand Chemical built the first kiloton aramid II production line in the country in May 2011.
Aramid fiber material is thin and soft in a golden color. It is widely used in automobiles, high-speed trains, cable and other fields. Honeycomb paper made of aramid is light and hardly deformed.
The core technology to produce aramid II was processed by two companies based in the United States and Japan. China was could not achieve industrial production and compelled to depend on imports.
After experimental verification, the aramid produced by Bluestar Chengrand has no differences than with imports of the same materials.
Domestic demand has increased by 20 percent every year.
Bluestar Chengrand could expand its aramid II capacity to a 10-fold increase by 2014 to 10,000 tons, making it the third largest supplier in the world.