Study On The Merger And Acquisitions Characteristics And Performance Of Chinese Cultural Enterprises

Encouraged by the policy, cultural industry began to take shape, gained favor from capital market and was experiencing a mergers and acquisitions boom in the fine market environment. Mergers and acquisitions of enterprises will influence the operation of companies, the adjustment of industrial structure, the development of the national economy, even the process of global economic integration. From the enterprise perspective, the research in both operational performance and M&A performance will reduce the blindness of cultural enterprises in the wave of mergers and acquisitions, improve cultural enterprises decision-making, and promote the healthy development of enterprises.Through the statistics comparison between quantity and trend of financial indicators of Chinese cultural enterprises from 2010 to 2014, the paper makes the quantitative analysis to the status quo of Chinese cultural enterprises and the mergers and acquisitions characteristics. Studying at the changes of performance in the previous year, M&A year and one year after of the listed cultural enterprises whose transactions took place during 2011 to 2013, the paper observes the differences brought by the transactions. Using the factor analysis method, the paper empirically analyzes the total M&A performance of the cultural enterprises, builds a synthetic evaluation function and calculates the quoted companies’M&A performances in the previous year, M&A year and one year after. Then the paper analyzes the companies’short time M&A performance, compares the differences of M&A performance under different M&A characteristics and testifies the factors that affect the performance of corporate merger and acquisition.Studying at a total of 109 cultural enterprises listed on Shanghai and Shenzhen Stock Exchanges by the end of 2014, the paper draws the following conclusions:From 2010 to 2014 Chinese cultural enterprises have developed rapidly. With the growing scale, solvency, operation capacity and profitability of enterprises decreased, and growth ability fluctuated. Mergers and acquisitions have a significant impact on the business performance of cultural enterprises. It expands the scale of the companies, improves the operational abilities and eases the constraints in the debt-paying and growth ability. At the expense of capital utilization efficiency, M&A enhances the ability to create profits. But the short-term performance of mergers and acquisitions declined when M&A occurred in 2011 and 2012, and few companies had a performance improved after the merger. While in 2013, the M&A performance improved and the ratio of performance improvement were equal between M&A year and one year after. Cultural enterprise mergers and acquisitions are becoming more and more mature. The ratio of positive difference of mergers and acquisitions performance increased year by year. And more and more listed cultural enterprises’short-term performance of mergers and acquisitions ameliorated.The characteristics of scales, targets and payment methods of M&A have no influence on the performance of M&A. When the scale of transactions is large enough, the performance of the M&A will be affected by the use of cash that year, while it will be restored to the former level one year after. Acquisition of an enterprise for the right of discourse or to control the target enterprise in the majority of equity improves the performance in the M&A year. However, companies would face with integration issues. The performances become obviously deteriorated after that. M&A through buying a minority stakes will reduce the score, especially in the M&A year. Then the score will be slightly increased. The impact of related transactions on the performance of M&A is greater than that of non-related transactions. And the performance of related transactions is positive while that of non-related transactions is negative.Combined with cultural enterprises characteristics, the paper quantitatively analyzes the status quo of Chinese cultural enterprises, the mergers and acquisitions characteristics and the fluctuation of enterprises management performance before and after the merger, and then builds a comprehensive assessment index to testify the differences of M&A performance under different M&A characteristics.