A Study On M & A Performance Of China Main Board

Currently, Mergers and Acquisitions has become an important mean for domestic and foreign enterprises'expansion. M&A can help the reallocation of resources, but whether or not M&A has increase the earnings for shareholders, and whether or not M&A has created benefits for the enterprise?The paper selects 67 M&A events of china main board in 2006 as samples, 26 of which are acquiring Companies and 41 acquired companies. Taking the drivers of M&A Performance into account, and learning from domestic and foreign research evaluation system, the paper select Return on Assets (ROA), Return on Equity (ROE), Liquidity Margin, Earnings per Share, Liquidity Ratio, Asset-liability Ratio, Working Capital Turnover, Total Asset Turnover, Capital Maintenance and Appreciation 9 indicators, which represent the profitability, solvency, management ability and the development capacity of listed companies, and reflect the M&A performance of listed companies. The thesis applies factor analysis into research, and analyzes the financial data of acquiring Companies and acquired companies in year before acquisition, M&A year, year after M&A, two years after M&A, and three years after M&A, then extracts Common factor, at last according to the variance of factor scores and their respective contribution obtains Overall Score, and take it as the performance to the comparative analysis of M&A performance before and after the change.The empirical results of all samples show: there is no substantial improvement in acquiring Companies operating performance, acquiring Companies company did not get obvious benefits; M&A increase the business performance and operational efficiency of acquired companies. The results show that not all M&A activities have reached the expected goal, so in accordance with the failure problem of M&A, the paper puts forward some reasonable proposals.