Study Of Mergers And Acquisitions Costs

Mergers and Acquisitions (commonly abbreviated as M&A) is an important form of assets reorganization. In terms of macro-perspective, M&A facilitates optimal combinations of social resources and adjustments to industrial structure. In terms of micro-perspective, M&A can bring economics of scale and synergy by which one enterprise's core competence will be improved. However, M&A as one way enterprises expand outwards is normally regarded as low-cost expansion. M&A is turned out to be low benefit even a failure due to the incorrect view. It is inaccurate analysis of M&A costs that results in the failure. Therefore, it is of great importance to systematically research M&A costs. The thesis divides M&A activity into three phases and then conducts detailed analysis of all costs in each phase in sequence.The thesis is divided into four chapters.The first chapter is a brief introduction to M&A costs. Based upon three phases of M&A activity, the thesis breaks M&A costs into M&A planning costs, M&A implementing costs and M&A integrating costs. Besides, the thesis reviews M&A in terms of cost effect, indicating that the positive effect of M&A is to decrease transaction cost and that the negative effect is to increase administration cost, followed by analyzing the cause of these effects in detail. Founded on these analyses, the thesis discusses the adequacy of scale of acquiring enterprise by means of marginal analysis method in economics.The second chapter is about costs incurred in planning phase of M&A. Planning phase of M&A mainly deals with⑴establishment of M&A...