Mergers And Acquisitions Of Economic Analysis

Along with the deepening of the reform of economic structure system in China, Merger and Acquisition (M&A), the key component capital operation, has been developing at an unprecedented speed. In 1997 and 1998 M&A of the listed companies in China achieved great progress in both of amounts and industries involved. In the meantime, the scale, depth and innovations of M&A also developed forward. M&A has been becoming one of the main instruments to adjust industry structures and to deepen enterprises reform. The thesis attempts to analyze enterprises M&A from the viewpoint of Economics, then finds out the rule of M&A practices according to these theories. There are five chapters in the thesis. The first chapter is the brief introduction of M&A, including the evolvement of enterprises, the definition of M&A, the mains types of M&A, the conditions and motivations of M&A. The second chapter analyzes the size of enterprises from the viewpoint of Neo-classic economics, that is focusing on production cost, revenue and adjustment of the size of enterprises to explain M&A. The third chapter interprets M&A from the viewpoint of transaction costs economics. According to transaction costs economics, market mechanism and enterprise organization are alternative since they have the same function. The key reason why M&A takes place is that it can save transaction costs when marketing transaction becomes the interior transaction for an enterprise. Based on the first three chapters, the fourth chapter analyzes the motivations of listed companies of China from the viewpoints of Macroeconomics and Microeconomics. The thesis pointed out the constitutions of the beneficial macro-economic background for M&A in China and the special reasons that promote Chinese enterprises to operate M&A activities. The last chapter concluded the main content of the thesis and proposed the topics for the further research.