Analysis Of M&A Performance In Chinese Environmental Industry

Since the 18th CPC National Congress,with the advancement of ecological civilization,various environmental protection policies have been gradually promulgated and implemented,and the environmental protection industry has ushered in a good opportunity for development.Taking a closer look at the industrial situation,the entry of a large number of enterprises has intensified competition in the same industry.Facing the coexistence of opportunities and challenges,mergers and acquisitions have become an important way for most companies to strengthen their strength and accelerate development.At present,mergers and acquisitions of environmental protection companies have become a development trend.Under such an industrial background,Yingfeng Environment grasped the industry situation,quickly merged and expanded into a leading enterprise in the industry,and created the largest merger and acquisition event in the domestic environmental protection industry.This thesis will use this case as a research object to explore the impact and causes of M&A incidents on Yingfeng’s environmental performance,and summarize the experience and inspiration brought by the case based on the industry background.This thesis first analyzes the status quo of the industry’s development,and guides the topics and research content discussed in this article,thereby explaining the significance of the research.Then based on the development background of the companies on both sides,the in-depth analysis of the merger and acquisition incentives of the two parties shows that the incentives of Yingfeng Environment’s mergers and acquisitions are:first,to improve its entire industrial chain and obtain synergies;second,it’s to help performance growth and enhance profitability.The motivations for the merger and acquisition of Zhonglian Environment are:first,the adjustment of the original parent company’s strategy to focus on core business;second,it helps achieve a win-win situation.Next,this thesis analyzes the performance of Yingfeng Environmental M&A,which is the core part of this article.First,the short-term performance is studied based on the event research method.The results show that during the entire window period,the cumulative excess return rate increases first and then decreases gradually,and the market’s short-term response to Yingfeng Environment’s acquisition shows volatility.The market response is not strong enough,and the short-term performance of Yingfeng Environment has not been significantly improved.Then,based on the financial indicator method,economic value added method and factor analysis method,the long-term performance is researched in order.The results show that the acquisition of Zhonglian Environment has significantly improved the long-term performance of Yingfeng Environment,and has improved its capabilities in many aspects.In the future,the long-term performance affected by the policy will further appear.In addition,based on a thorough understanding of the industry background and mergers and acquisitions plans,this article provides a more reasonable explanation of the reasons for changes in short-term and long-term performance.Finally,based on the analysis of this case,this thesis summarizes four points of enlightenment:first,before the merger and acquisition,the company should fully make a strategic layout,clarify the original intention and expectations of the M&A;Secondly,the company should reasonably design the M&A plan and strengthen the risk prevention;The third is that the environmental protection industry is greatly affected by policies,and should pay close attention to policy opportunities and risks,and make strategic adjustments;Fourth,pay attention to management after M&A,and motivate employees through equity incentives to accelerate corporate absorption and integration.