The Research On M & A Value Of Shaanxi JIANSHI Concrete Co.Ltd.

The reverse choice caused by inside information close of nonpublic medium and small sized enterprises lead to the fact that the Pareto Effect can't be achieved in the M&A trade market. In the extreme condition, the M&A trade market can't be formed. In addition, the value of the high-quality companies may be underestimated seriously because of high trade cost of M&A. In order to verify this conclusion, the text chose the company, which the author once works in as research subject and had supported above-mentioned conclusions through theory analysis and empirical research.Shaanxi JIANSHI concrete limited company is a very typical nonpublic medium and small sized enterprise. According to the nonpublic company valuation theory, the text has estimated the company's M&A value from two different angles on the basis of its real financial materials. After fully analyzing the competitive environment and competitive position of this company, the text has accurately estimated the company's future cash flow from its long-term development strategy and its financial statement. Through the analysis of the company's cost of capital under the two kinds of M&A model, it also drew two kinds of different discount rates. And then it came to the conclusion of M&A value as follows: thetransferring value (that is fair market value) is 6,080,000 RMB when under the going concern premise with existing resources and the investment value is 45,000,000 RMB when the company merge and acquisition with XISHUI Co. Ltd. The difference between the two plans is the synergy, which impels the M & A.But three stock transactions that the company later took place have indicated the big differences between practical transaction and estimating data. This does not prove that the estimating results are wrong but indicates the company's value had been seriously underestimated or twisted. Its later operating performance had also proved it. On the basis of valuation, the text then provided the company's M&A financing plan. It had also proved that the fact and reason, which are low-marketability of stock and probably underestimated value of nonpublic medium and small-sized enterprises in the developing M&A trade areas because of the information asymmetry and too high transaction cost, with theory calculating and empirical analyzing method.