Research And Case Study On Mergers & Acquisitions Decision-Making Model Of China's Textile And Apparel Listed Companies

With the further adjustment of the textile and apparel industry, the textile and apparel companies has been constantly looking for a way for the rapid growth. The Merger and Acquisition (shorter form, M&A) is been a most important vehicle to accelerate the optimal allocation of resources in the textile and apparel business, and .has appeared newly internationalized and capitalized.With the rapid development of the capital market, the textile and apparel enterprises, especially those Listed, have already carried out various M&A, from which they also gained rich successful experiences. In addition, for the Chinese textile and apparel business, the global financial storm triggered by sub-prime mortgage crisis in the USA, is not only a challenge but also a rare opportunity for the industrial restructure and international merger and acquisition and the access to the high-end market. However, it should be noted that the high yield and efficiency often accompanied with high-risk, therefore, making scientific decisions to minimize the risk become important on M&A behavior study. In theory, the study made by the Chinese scholars on the M&A behavior covered many aspects, such as M&A motivation, M&A Boundaries, Asset Portfolio, M&A Regulations, M&A performance, etc. But the research on the M&A decision-making in the textile and apparel field turns out blank.Through the constant study on many documents, the analysis on the data and information from the textile and apparel listed companies; as well as the visits to textile and apparel companies and securities firms, the paper has obtained the first-hand meaningful information on M&A. Besides, the author has learned the practical experience on M&A from the survey on the Operating due Diligence in the listed companies in the textile and apparel field.Main content of this paper:①Define the M&A concepts and procedures and state the status quo, characteristics and experience of textile and apparel industry at home and abroad; analyze the overall development of the domestic textile and apparel listed companies in 2007;②Analyze the M&A risk and strategy of the domestic textile and apparel enterprises through Corporate Research and experts interviews; build the indicators of the M&A risk management system and test the M&A integration risk Management Decision-making model of the fuzzy entropy comprehensive evaluation, on the basis of the case studies and expert feedback;③Aet out the principles of selection and screening methods; do the logistic regression analysis by statistical software with the characteristics indicators of the domestic textile and apparel listed companies; set the forecast model of the decision-making for the possible merger and acquisition of a corporate;④tate the three types of Due Diligence survey----Law, Finance and Operation, and Media by introducing the definition, principles and effect of Due Diligence; taking the example of C-BONS acquiring Hubei Maiya, make analyze on the business Due Diligence;⑤tate the usage of the Brand Value and Income Approach in the textile and apparel on the basis of definitions of value assessment and methods; make data analyze on the price of M&A decision-making of the textile and apparel and try to define the space range of the price; explain the pricing process by Youngor as it acquired KWD men's Department., through building the international textile and apparel M&A pricing model based on the comparable transactions method.The innovative point in this article is the study on the M&A procedure and decision-making methods, based on experiences from the textile and apparel listed companies in China; combined with the characteristics of textile and apparel industry, the paper sets decision-making models for all stages and applies to the practical domestic M&A cases to make references, which is also the initial point of this paper.