Long-term Performance Of The Merger And Acquisition Between GOLDWIND And VENSYS

In the process of globalization and increasingly frequent commercial activities among the majoreconomies of the world, a growing number of entrepreneurs turn their eyes to cross-border mergersand acquisitions as a significant means of expanding and accelerating their corporate development.Thirty-year reform-and-open policy and stable development grant Chinese enterprises withadmirable international competitiveness and light their passion to further corporate growth bydeveloping international markets, meanwhile the worldwide wave of industrial-chain-consolidationbrings Chinese companies new challenges to their successful transformation. In the post-economiccrisis era, as the global financial crisis spread to the real economy and the slow recovery of theworld economy, global asset has shrunk dramatically which thereby set off a new wave of M&Awave.In this paper, a horizontal M&A case between GOLDWIND and VENSYS was studied, focusingon the phase-characteristic-and-status analysis of China’s overseas M&A activities andcomparative analysis of the acquirer’s M&A long-term performance within five years throughboth economic and social benefits. In the latter analysis, a new indicators system of the company’sannual fixed effects model was reconstructed, besides with a long-term comprehensiveperformance scoring model being applied based on principal component analysis to evaluate andcalculate the M&A long-term performance. The empirical results showed that the case companyfinancially benefited from a short-term boost from the overseas M&A; while this upgrade did notshow good sustainability. Except for the slightly increased employment, the case company showedpoor social benefits through a decline in employee welfares and tax reduction. Finally, whileproposing research conclusions, a reflection of the M&A case was conducted and severalreferences for our companies, industries and relevant government departments aspiring to achievefurther expansion through overseas M&A were summarized.Compared with traditional researches, this paper shows several creative options on bothresearching ideas and researching methods, which ensures the realistic values of it conclusions andenriches our researching ideas and methods on performance study of M&A.