The Performance Of M&A By Private Company

Since 1997, with the development of stock market and the strengthening of private companies, the phenomenon of M&A of public company by private company have emerged continuously. The paper studies the social, economic and institutional reasons for the phenomenon both theoretically and demonstratively, and the positive effect both to the company and to the society. The paper is consist of six sections:The first section puts forward the studied object and portrays the related situation in China.The second section introduces the related definition of M&A, including the defmition of M&A, the classification of M&A and the theory of M&A. Analyses the internal and external reasons for the emergence of M&A of public company by private company in China, based on the common reason of Chinese companies' M&A.The third section reviews the existing M&A performance appraising methods and standards, on the basis of which, we select the applicable appraising system of this paper.The forth section analyses demonstratively the effect of M&A of public company by private company, including M&A' s benefits and operate benefits. The paper chooses the M&A cases took place in Shanghai and Shenzhen stock exchange; adopting cases study method and financial index method. It concludes that some of the M&A react overly and the consistency isn' t good, the M&A is not successful.Finally, according to the result, we point out the feature of M&A in 2000-2001, and explain the reason why the performance of M&A by private company is not as good as expected. What we will to do is to provide feasible strategies for the private company' s M&A and its further development.