Performance Study Of Spin-off

Diversification of the enterprise scale expansion boom has become the main way to improve earnings, asset restructuring and mergers and acquisitions as an important way to increase efficiency. However, since the eighties and nineties diversity has caused people’s attention as it had taken some negative effects,the most serious of which is inefficient management and difficult to achieve diversification synergies, as a result, people began to reflect on the rational enterprise boundaries, and began to shrink the size of existing enterprises, the spin-off of the enterprises which is diversified investment operation is the cold thought, however, accompanied by the fifth merger wave of the late 19th century, the number of western spin-off cases d were rising rapidly, which caused the spin-off performance of questions worth pondering. Based on this, the author hope that the analysis of typical cases can help to better understand the performance of spin-off company and to provide useful spin-off experience. On the architecture level, first of all, based on the past performance of a spin-off literature the author list a brief overview and introduce the idea of this study, methods, expected contributions and limitations. Secondly, it introduces two theories of spin-off, namely, the hypothesis of asymmetric information theory of value theory and asset stripping theory, then it analysis the two theoretical studies which use in the real situation, on this basis, it proposes that must have a market environment and the company’s own conditions to spin-off and characteristics of spin-off companies and the economic motivation; spin-off, after all, as a double-edged sword, however, not only to the market and the company itself has brought spin-off benefits, but also to the market and the company itself created a certain amount of risk. How much effect will spin-off produce, the author compare with our current market influence of listed companies-Lenovo Group, analysis the effect of Legend spin-off Digital China, the case focused on the capital market and financial data to analysis the performance of spin-off, and, in this paper it investigates the performance into a short-term performance and long-term performance, and respectively analysis operating capabilities, profitability and development capacity analysis of the financial indicators of Lenovo Group, Digital and the combined company, and find that early in the capital market, Lenovo gets more negative reactions However, the performance of its financial indicators is comparatively good, and Digital China has a significant improvement both in two ways; but in the long-term as to Lenovo and Digital China the effects of spin-off not only in the capital market or in profitability, ability to develop or upgrade do not show substantial growth, but showing a low ebb after experienced significant fluctuations in the short term. Based on this, the author of this article concludes with a spin-off behavior of listed companies some reflections.This study on the behavior making certain to add the study of our domestic split part of the theory and practice and have some inspiration empirical analysis to our domestic spin-off acts of the listed companies.