The Study Of The Enterprise M&A Value Based On The Theory Of Real Options

In Mergers and Acquisitions (M&A), Enterprise value, as a whole, is based on the basis of continuing operations, Depending on the company's future profitability. Business valuation, in essence, is a realistic and subjective judgements, But it does not mean that it could dictate prices, Business valuation is based on certain financial theories and models as well as professional insight and experience-based. Value of the assessment results directly related to the success or failure of M&A. Business growth in M&A is a means of capital operation, to enterprises in the fierce competition in a dominant position plays an important role. In the past, the value of M&A focused on the value of traditional ways, focusing on the value of qualitative analysis of M&A. I analyze the value of M&A in the real options perspective. This paper also focus from the way of real options to analysis the value of M&A, comparing several traditional analysis methods. When analyzing the case, I compare the conclusion between the discount cash flow and real options method. So, I choose the real options system in uncertainly conditions. In addition, my paper choose a relatively case to analyze the application of real options, and show the real options approach is reasonable.