The Research On Financial Performance Of Cross-border M&A Of Z Company

Nowadays, cross-border M&A has became the main form of international investmentwith the development of economic globalization, the goal of which tends to enhance theinternational competitiveness and realize the global strategy for a long time of enterprises.After years of development, some Chinese companies have occupy a large share of thedomestic market, but there is a certain degree of difficulty to break up. some companies needto expand the brand influence and enhance technology advantage or strengthen theconstruction of sales channels, so “going out” is a good choice for them. Admittedly,cross-border M&A can promote enterprise to speed up the capital restructuring, optimizingthe allocation of resources, forming the scale benefits, and enhancing the competitiveness ofenterprises. It is foreseeable that, with the rapid growth of Chinese economy and theimprovement of Chinese enterprises strength and management level, Chinese enterprisestransnational M&A will be increasing and be affected by widespread concern of theinternational community.From practical experience, determining the success of a business merger, or whetherachieving the desired goal, we should start in-depth analysis of the performance fromacquisitions. The analysis method of the M&A performance mainly from the financial indexand stock price movements. Due to the presence of a weak effectiveness of China’s securitiesmarket and a lot of non-tradable shares, stock price fluctuations is difficult to measure incomechange in the non-tradable shareholders, and thus can not measure the change of the MergingCompany’s performance, so the domestic generally uses the financial index analysis methodin the study of M&A performance.Z company as a leader in the field of China Construction machinery manufacturing,whose methods of succeeding in transnational mergers and acquisitions is worth exploring.This article intend to explore the consolidation process and effect after Z company take overItaly C company, in hope of offering help and reference for the road of Chinese enterprises’cross-border M&A. The article is divided into five parts, the first part is an overview ofresearch background and significance of transnational merger and acquisition and anintroduction of domestic and foreign research situation and determines the ideas and methodsof the paper. The second part is the theoretical groundwork for the article, which mainly describes the theory of M&A motivation, merger integration and financial performance. Thethird part focus on describing the situation of both mergers and acquisitions, the motivation,environment and risk of M&A and process in the case. The fourth part specifically describesthe integration ways after Z take over C company, and using the method of financialindicators which include the profit ability, growth ability, operation ability, debt paying abilityand cash flow to analyze the M&A result on financial performance. Based on the aboveanalysis, the fifth part summarize the beneficial experience for other enterprises for referenceand study.The contribution of this article is to let the domestic well-known listing Corporationtransnational merger as the object of study, in order to sum up the experience of enterpriseintegration and cross-border M&A, to provide some references for overseas mergers andacquisitions road of subsequent domestic enterprises.