Study On The Motivation And Performance Of Merger And Reorganization Of Jinyu And Jidong Cement Under The Background Of Supply Side Reform

Cement industry is closely related to China’s infrastructure development of pillar industry,with China’s economic development,cement industry has been rapidly expanding.However,after years of rapid development,fixed asset investment and real estate investment growth rate gradually declined,cement products demand is also declining,cement industry has become a serious overcapacity industry.Because of the structural contradiction between supply and demand prominent,benefits of cement enterprises decline,in 2015 there was an industry-wide loss situation.At the end of 2015,the central government proposed supply-side reform,the cement industry ushered in a turnaround,cement industry is one of the industries in urgent need of reform.In order to solve the problems of cement industry,merger and reorganization is an important way encouraged to do the supply-side reform of cement industry.This paper takes the case of Jinyu Group and Jidong Cement Merger and Reorganization in the context of supply-side reform as the research object,which started from 2016 and completed in 2018.At first,this paper summarizes the tendency of the development of the cement industry and the characteristics of the merger and reorganization of cement enterprises under the background of supply-side reform.This paper introduces the situation of Jinyu Group and Jidong Cement,the background and process of merger and reorganization,and analyzes the characteristics of this merger and reorganization case compared with the past.Secondly,due to the diversification of the motivations of enterprise merger and reorganization under different policy backgrounds,this paper analyzes the motivation of the merger and reorganization of Jinyu Group and Jidong Cement from multiple angles.It thinks that the motivation are as follows: the motivation of mergers conclude responding to national policies to promote supply-side reform,improving the concentration of the cement industry,optimizing the BeijingTianjin-Hebei ecology,etc,and these are external motivation.Jinyu Group and Jidong Cement want to seek merger and acquisition synergies to improve their performance is also one of the main motivation of the merger and reorganization.After analyzing the motivation of the merger of Jinyu Group and Jidong Cement,this paper evaluates the performance of Jidong Cement before and after the merger and reorganization,including financial and non-financial perspective.Financial performance selected four financial capacity indicators,EVA indicators,and selected stock price changes for analysis,nonfinancial performance mainly about the implementation of the supply-side reform before and after the merger and reorganization of Jidong Cement and market share analysis,the reduction of capacity is not significant and still need to push on,deleveraging,cost reduction,making up for short boards have all achieved good results.In the end,this paper summarizes the enlightenment of the merger and reorganization case struck by Jinyu Group and Jidong Cement,and the deficiencies of the study.This case is the largest scale merger and reorganization event realized by marketization of cement industry in China,which effectively solves the problems faced by cement enterprises,plays an important role in promoting the reform of cement industry,and becomes a model of successful merger and reorganization of enterprises under the background of supply-side reform,which has some reference significance for the supplyside reform of cement industry.