The Characteristics Of Takeover Targets

With the development of world ecmonics and industry, merger and acquisition activity grows fast. It cannot only promote wealth centralization and optimization, but also can impulse industry upgrade. As far as an acquiring firm concerned, how to make a very reasonable target is a very significant issue. The characteristics of targets are the important factors for merger and acquisition active, so it is necessary to carry on further investigation on this problem.This article is organized as follows: first it summarizes the overseas theory about the merger and acquition, finding the important factors influencing merger success. Then it performs empirical research on it combining with targets of Chinese listed companies in 2005. I have used the data of M&A over the year of 2004 and used methods both ANOVA and logistic. The conclusion provides a solid experimental support on the replacement of inefficient management hypothesis, the shares liquidity hypothesis, the shares decentralization hypothesis, and provides no support on the financial leverage hypothesis. At last, combining the above theory and the conclusion of the empirical research, this article puts forward some policy on how to choose reasonable targets for Chinese acquiring companies and gives some opinions on it to the government.I really hope the theory and the positive research conclusion referred to in this article can improve choose of targets and can give some suggestions for the acquiring firms in making merger and acquisiton decisions.