Research On The Motivation And Performance Of Hong Yang Energy M&A Shenyang JM Incorporated Company

M&A(Mergers and Acquisitions)is an important means for an enterprise to improve its quality of assets,play synergy and improve its competitiveness.A ten-year gold period of coal industry came to an end in our country in 2012 because of overcapacity of production,lack of demand and continually falling prices,which caused many large-scale coal enterprises to be in the face of bankruptcy with new types of energy emerging.“The announcement of the elimination of backward capacity of coal industry” and “The 12 th five-year plan for the development of coal industry” and other policies were issued in succession to encourage and facilitate mergers and reorganization of coal mining enterprises so as to develop large coal group.Under such circumstance,Hong Yang Energy announced the M&A of Shenyang Co Coal Limited Liability Company,a wholly owned subsidiary of Shenyang Controlling Shareholder Coking Coal Industry Group in July 2014.Hong Yang Energy has turned into a large-scale coal-electricity integrated enterprise through mergers and acquisitions.From the perspectives of market performance and financial performance,this thesis does a research on the M&A performance of the acquisition of Shenyang Coking Coal Industry Group by Hong Yang Energy.,LTD.The thesis puts forward some proposals for the merger and development of domestic energy enterprises in combination with the research conclusion and current economic situation and national policies.Combining the research conclusion with the current economic situation and national policies,this thesis first describes the concept of merger performance,and then put forward proposals for domestic energy enterprises to merger and to develop.First of all,this paper firstly sets forth the concept of M&A performance,the way and motivation of M&A and two kinds of methods of M&A performance evaluation.And then it analyzes the fundamental state of M&A of Shenyang JM Incorporated Company,including by Hong Yang Energy.It includes the analysis of the state policies of M&A,the industry background,the operating conditions of both sides,historical evolution and financial status.In addition,this thesis also presents the process of M&A and an analysis of the enterprise integration.Also,the thesis analyzes the motivations of M&A,evaluates the M&A performance by means of event study and factor analysis.The research findings are as follows:(1)The reform of state-owned assets,the closing down outdated production facilities and other national policies,M&A enterprise stripping non-performing assets and multiple factors contribute to the M&A Shenyang JM by Hong Yang Energy;(2)The markets' reaction to the deal is positive,and the acquisition helps to bring wealth to corporate shareholders;(3)By adopting factor analysis method this thesis calculates a comprehensive score with the reflected financial indicators such as the enterprise debt paying ability,profit-making ability,operating ability and development ability in the 30 enterprises from the same industry,coming up with industry rankings.From four aspects of financial indicators to Hong Yang Energy's comprehensive ranking has ascended from 22 a year ago to12 in the same year of M&A,and it dropped to 25 one year later.In reference to the analysis of the financial indexes,as you can see,Hong Yang Energy's financial performance has dropped after mergers and acquisitions.Finally,evaluate the advantages and disadvantages of M&A,and thesis provides some enlightenments and references for the enterprises,investors and regulators who are also in this industry.