The Cooperation And Collaboration Of Supply Chain In Horizontal Merger Of Enterprises

The M&A of enterprise is an inevitable event as the market economy develops. There have had five extensive climaxes of corporate M&A all over the world since the end of 19 centuries. With the stinging competition between enterprises, M&A and SCM has become enterprises'universal aspiration. Nowaday, companies are not adapt to the fast change of market by expanding itself. M&A, especially horizontal merger has been an important expanding mode in current market. M&A in our country have developed greatly in recent years. For example, LENOVO has been the third global PC manufacturer by M&A.However, M&A is not always successful and about 61% of them is abortive according to Mckinsey & Company's research. M&A is a kind of very complicated economic phenomena which involved in every aspect of a company. The four stages are considered to be necessary for the M&A—preparation, negotiation, external integration and internal integration. Any mistaking in the four stages may lead to an abortive M&A. Enterprises expect to gain synergy by horizontal M&A. But how? I think the key to realize mergers'synergy lies in how to effectively integrate the two similar and unaided Supply Chains. However, the research on integrating SC in M&A is correspondingly lack interiorly and overseas.The thesis mainly studies how to integrate upriver suppliers and downriver distributors to make the two supply chains to combine into one on the basis of core enterprises'three-echelon supply chain. The article is composed by three part. Firstly, the author explains the concepts of horizontal mergers and SCM, analyzes the influence of SCM because of horizontal mergers. The second part analyzes composing of M&A enterprises'purchasing and distributor total costs, establish purchasing and distributor total costs'mathematical programming integration model on the basis of core enterprises and character of horizontal merger, demonstrate the effectiveness of mathematical programming integration model for upriver suppliers and downriver distributors by numerical examples. The third part explains M&A enterprises should reinforce the management core enterprises-based supply chain partnership and coordination between enterprises of supply chain to strengthen the key competitiveness of the whole supply chain after M&A.M&A and SCM has become an important part enterprise management in 21 centuries. The article puts forward to a method of supply chain integration after M&A to raise the possibilities of success in M&A. The author hopes arouse the attention of experts and scholars to supply chain integration so that they can make further research.