Value Creation Analysis On Youku-Tudou Merger

Judging from the merger trends in the United States and European Union over the last several decades, merger has become an important way for a company to develop and grow stronger. In China, the Internet-based economy thrives as a result of China’s economic restructuring and the transformation of economic growth model. In 2012, its market value reached 385.04 billion yuan. As a part of Internet-based economy, the Internet video industry is also developing rapidly and the research into the merger of Chinese Internet video companies could be inspiring, especially the analysis on the merger of two leading companies in the industry—Youku.com and Tudou.com.This thesis first illustrates the background information, significance, purpose, methodology and innovative points of the analysis. By reviewing the literatures on company merger cases took place in China and other countries, the thesis introduces relevant theories on merger such as the synergy effect theory, the theory of internal capital markets, the market power theory and the tax shield theory. It is hoped that the analysis on the value creation after the Youku—Tudou merger could be beneficial to future research on financial integration.