Research On Mergers And Acquisitions Performance Of Hebei Iron And Steel Group

Our country is a large country not only for iron and steel production but also for iron and steel consumption. For one thing, iron and steel products meet the needs of domestic and promote the development of relevant industries at the same time. For another, iron and steel products also make a great contribution to the economic development of our country. Global iron and steel enterprises, from the end of 19th to nowadays, have had five large-scale mergers and acquisitions in more than one hundred years. As for our national iron and steel industries, there is also an irresistible trend to mergers and acquisitions."Iron and Steel Industrial Development Policy"was promulgated by state department in 2005, which emphasized on the readjust of iron and steel products structure, industrial layout, and industrial organization structure. It required give an energetic improvement to the degree of industry concentration and expand scale of major iron and steel enterprises through carrying out annexation and reorganization. The paper, under such a spectacular background, expounds some correlative theories about iron and steel enterprise purchasing and merging. It chooses a overall financial index system to make further research on such merging matters of Hebei Iron and Steel Group and use principal component analysis approach to estimate performance and reach a conclusion.The paper introduces some mergers and acquisitions concepts through researching on a large number of internal and external literatures and explicitly explains basic theory of enterprise mergers and acquisitions from four aspects, efficiency theory, transaction cost theory, value underestimate theory and agency theory. It fully analyses conformity content about enterprise mergers and acquisitions from four aspects: strategy, organization, human recourses, and culture. The style, motivation, risk and principle of our national enterprise mergers and acquisitions have also been introduced in the paper.The paper sets up overall financial index system which depends on self-feature of Hebei Iron and Steel Group and chooses principal component analysis approach to build a scientific and reasonable mathematical model. Moreover, it establishes relevant procedures for enterprise and evaluates performance for management. Thus enterprise can enhance managerial effectiveness and give full play to the effect of mergers and acquisitions ultimately.