China's Pharmaceutical Industry Listed Company Merger And Acquisition Performance Empirical Research

It has been very late until China’s market starts Merger and Acquisition(M&A).But with the deepening of the reform and opening-up and the country’s joining theWTO, the influence of the global economy on China is increasing. With the rapiddevelopment of China’s economy and the capital market, mergers and acquisitions inChina are emerging in endlessly, and the market has been activated. It is on thisbackground that the pharmaceuticals industry M&A begins. At the same time underthe influence of the country’s family planning policy, China is gradually becoming anaging society, which makes medical care more and more important. As a rising-sunindustry, the pharmaceutical industry will play a very important role in the future ofthe country’s whole economic development. That is the reason why in recent years thestate is continuously launching policies ensuring the reforms in pharmaceuticaldomain. In order to enable the pharmaceutical industry go on the track of a soundprogress, the effectiveness of emerges cannot be ignored, which, therefore, gives thepractical significance to the research into merging performance of listed companiesThis thesis follows the systematic steps of theoretical basis, industry status quo,evaluation system establishment, positive analysis, in order to study the mergingperformance of listed companies. Based on accounting research methods, it hasselected40listed companies as samples in which M&A happened between2007and2008. Using basic descriptive statistics and factor analysis, the positive analysis hascompared the average score of the corporations’ performances a year before M&A,during it, a year and two years after it, and reached the following conclusion: netprofit ratio, sustainable growth rate, capital maintenance rate have all experienced adrop in the year of M&A. And with no exception, their performances have allfollowed the trend to decline first, and then ascend, which was followed by anotherdecline, but always perform better than before. Therefore, it’s possible to assert thatM&A brings certain performance improvement to enterprises. In addition, from thepoint of view of factor analysis, the performance of the listed companies of thecountry’s pharmaceutical industry during the M&A is not as good as the year before it.But in the first and second year after the mergers and acquisitions, the performancegoes into a steady rise, which once again proves the advantages M&A brings tocompanies.Finally, aiming at some problems in M&A, in combination with today’s nationaleconomic policy and economic circumstances, on a basis of the positive analysis, thepaper put forward suggestions for the purpose of bettering M&A performance.