Merger & Acquisition And Reorganization By New Hope Study On Value Assessment And Tax-related Issues

With the rapid development of Chinese economy,by the end of 2016,the number of A-share listed companies in China has exceeded 3,000,realizing a total market value of CNY 55.68 trillion.The strength of China's capital market has been enhanced and improved.With the help of such a good financing platform of capital market,the listed companies can raise the funds they required,which provides the capital advantage for making the listed companies bigger and stronger through merger & acquisition(“M&A”)and reorganization.At present,by M&A and reorganization,a large number of listed companies have realized the resources integration,reduced the production cost,improved the core competitiveness,enhanced the economic benefit and expanded the strength.In this paper,the capital operation for the M&A and reorganization of Liuhe Group and the related companies(“the target companies”)by New Hope are taken as the object of study and the various related aspects are introduced,including the relevant theories and both parties' backgrounds of the M&A and reorganization from the motivation and strategy of the M&A and reorganization,value assessment of the target companies,selection of assessment method,influencing factors of assessment result and existing problems,and tax-related matters and the corresponding impacts on the M&A and reorganization.In combination with the economic management theories and knowledge of finance,including company law,finance,financial management,accounting,data and model,strategic management,taxation and managerial economics,the issues of merger and acquisition strategy,value assessment and tax-related issues in the M&A and reorganization are explored,studied and solved.Firstly,the background and meaning of the study,literature of value assessment at home and abroad are introduced;the M&A and reorganization are defined and classified and the theoretical knowledge of value assessment methods and the advantages and disadvantages of all kinds of assessment methods are discussed.Secondly,through examples,the background information about both parties involved in the M&A and reorganization and the practical situations of trading scheme are introduced,the motivation of the M&A and reorganization is analyzed,and the merger &acquisition strategy is analyzed in details by means of SWOT method.Besides,materials and information are collected and the reasons for the M&A and reorganization are analyzed.Thirdly,in combination with the case of M&A and reorganization,the value assessment of the target companies is made by use of both cost method and income method and the two methods and their influencing factors are analyzed.The advantages and problems in the two methods are found from the actual situation,which provides guidance and practical experience for both parties to confirm the fair assessment results,and suggestions are made for the value assessment for the target companies in the M&A and reorganization.Fourthly,in combination with the knowledge of tax-related laws and regulations,the tax-related matters the corresponding impacts on the M&A and reorganization are analyzed and corresponding suggestions are proposed.Finally,market method is adopted for evaluating the rationality of the value assessment in the M&A and reorganization,and a detailed analysis is made on the performance and impact of the M&A and reorganization on the company listing by means of comparison method.