Case Study On Cross Border Merger And Acquisition Of Urbaser By China Tianying INC

Cross border M & A has gradually become an important way of enterprise development.The main purpose of cross-border M & A is to form large-scale and even international influential enterprises through industrial integration and upgrading.In recent years,in the case of cross-border M & A,Chinese enterprises often annex large companies several times their own.The core of the trend is the demand for high-quality products overseas and even in the world.A new round of competition pattern of enterprises has gradually formed.In particular,listed companies,especially science and technology,quickly acquire technology and resources through cross-border M & A.They realize strategic synergy,and continue to grow stronger.In the environmental protection industry,enterprises acquire technology quickly through M & A,which has achieved good results in general.For instance,based on the cross-border merger and acquisition of Urbaser by Tianying of China,this paper studies how to successfully inject urbaser into listed companies in three steps from 2016 to 2019.After introducing the relevant industry background and the situation of the enterprises of both sides,this paper first analyzes the motivation of both sides.Then,it makes a brief introduction of the time line of the merger and acquisition process,focusing on the valuation method,structural arrangement,financing method and payment method,trying to identify the intention behind the series of capital operations On this basis,the process of M & A is evaluated.Then,it makes a comparative analysis on the performance of Tianying before and after M & A,including whether it can meet the M & a motivation and achieve the corresponding value expectation.From the long-term and short-term point of view,the short-term is mainly measured by the market performance.The long-term perspective is to evaluate and analyze the financial indicators,growth angle and integration effect,predict the future development trend,and strive to show the impact of M & A fairly and objectively.Finally,this paper summarizes the experience of cross-border M & A in China.Through the research,this paper believes that the design of key points in the process of M & A of Tianying can be used for reference,but the preliminary integration effect and performance are slightly lower than expected.First,it is reasonable to use the income method in the valuation of the subject matter.Because urbaser’s revenue and profits are relatively stable,and it is not a listed company,the market method does not have a good adaptability.At the same time,it needs to combine with the actual background,and appropriate premium can exclude competitors;second,the transaction structure is relatively complete.In the design of transaction structure,it adopts the form of M & A fund and double-layer SPV.China Tianying joint private equity fund establishes M & A fund.By holding shares in the private fund,it acts as a inferior LP in the M & A fund to maintain control over the target of M & A.Third,adopt a variety of financing methods to ensure the smooth completion of M & A.Including: cross bridge funds,the introduction of equity investors,the use of intermediate SPV pledge loans,a variety of ways to raise funds.Fourthly,installment payment plus contingent terms is selected as the payment method,which effectively relieves the payment pressure.This measure effectively reduces the possible valuation risk due to information asymmetry.Fifthly,through the withdrawal of the target in advance to avoid cross shareholding,reasonable arrangements for the withdrawal of M & a funds to maintain equity stability.The above all contributed to the successful implementation of the merger and acquisition.The real success of M & A lies in the performance.This paper studies the effects of different stages.It is found that market feedback is relatively positive in the short term.In the long-term performance,the financial indicators show the advantages of high revenue and high turnover rate,but there are still problems of high cost and low profit margin.The number and amount of contracts in non-financial performance increase slightly Weak,R & D expenditure and the number of R & D personnel need to be further strengthened.Finally,this paper summarizes the M& a process,analyzes the M & A results,and believes that the follow-up financial and business integration needs to further play a synergistic effect.