Analysis On The Synergy Effect Of M & A

Since the eighties of last century, many developed countries in the world have developed a five wave of mergers and acquisitions. The vast majority of famous foreign companies such as GE, IBM, without exception, are through mergers and acquisitions has been the development of a and M & A in China in 2015 a staggering record, case number compared to the same period last year, a 37% increase in the corresponding to a total amount of up to 84%, reached a staggering $734 billion. With the "on further promote the introduction of the healthy development of the capital market a number of opinions" file, the China Securities Regulatory Commission (CSRC) corresponding to listed companies and related non public offering, a major reorganization of assets of the regulations have been revised, the revised greatly simplifies the process of mergers and acquisitions, improves the efficiency. The enthusiasm of capital market M & A is suddenly rising.In the final analysis, the enterprise initiated M & a transaction is to achieve long-term continuous growth, the integration of successful M & A transactions can allow enterprises to achieve the integration of upstream and downstream industry chain, to achieve synergies and other resources. But we also should pay attention to the process and mechanism of value creation in M & A, which is believed to for Chinese enterprises through mergers and acquisitions to rapid growth and expansion has important strategic significance, for the construction of efficient and healthy capital market environment also has important guiding significance.This view is different from the traditional free cash flow to estimate the market value of the enterprise, should be mergers and acquisitions as a measure of the competitive strategy of the enterprise value of a combination part belong to business enterprise inside, on the competitive advantage of the enterprises changes become the source of value creation of enterprise merger and acquisition.This paper analyzes the SW and Hong Yuan Securities merger cases, trying to find out the mechanism of mergers and acquisitions to create value. The article first introduces the development of China’s securities market, in this context, the securities companies have continued to expand the natural needs of net capital, so as to achieve the purpose of bigger and stronger. Then it introduces the S W and Hong Yuan Securities mergers and acquisitions both historical background, initiated the motivation and realization scheme of design and market process of merger and acquisition, the acquisition scheme taking into account the interests of shareholders and the M & a choice of price is the highlight of this acquisition scheme. Since the merger is the first attempt to try to backdoor listing in the trial after the first attempt at the same controller under the non-listed company to absorb the merger of listing Corporation, to achieve a breakthrough in the way of the securities companies listed. Between the merger occurred in the Central Huijin under the same actual controller belonging to the two independent companies, through the power of the capital market, on the basis of equality of communication, the two sides of the innovative market of convertible merger case, from scheme which takes into account the interests of all parties.The article mainly thinks that the value of the merger is reflected in the synergy effect, the specific performance of the synergy in the management, management synergies and financial synergies. But at the same time it also contains the risk of mergers and acquisitions, the specific performance of the financial pressure of the enterprise after the merger is relatively large, especially the operating cash flow of this, it is worth the attention of the company management layer.The last section tries to explore the response of the market from the two level market share price, using the event analysis method to do research and analysis.Due to the limited time and energy, this article is only a simple analysis of the financial aspects of the acquisition process, there are many deficiencies.