A Study On The Valuation Of The Primary Market M&A Enterprises

Under the tide of China's listed companies participating in mergers and acquisitions,as a more effective capital tool for mergers and acquisitions of listed companies,"PE+ listed company" model M & A fund came into being.After a short period of development,this type of M & A fund has been controversial while being sought after by the market.The basis of its benign operation is to truly serve the industrial integration and strategic transformation of listed companies.Its essence is to search for valuable assets to invest and to help the listed companies to achieve the strategic goal through mergers and acquisitions of listed companies or other means of capital operation.One of the key links involved is how to assess the value of underlying assets.Under the perspective of the "PE+ listed company" model M & A fund,the valuation method and applicability are different from the traditional equity investment.In this paper,the valuation method of this specific type of "PE+ listed company" model M & A fund in investment is discussed and studied on the basis of traditional valuation methods and theories combined with practical experience.The application of the above valuation methods in practice is expounded in detail through two cases of real personal experience and the reasons for the final investment decision are analyzed.Problems and matters needing attention in operation of the "PE+ listed company" model M & A fund are also discussed in this paper and various factors affecting their valuation are analyzed.In China's market environment,the relative valuation method of the P / E model is the most commonly used method in the investment of the "PE+ listed company" model M & A fund.It is easy to operate and relatively easy to understand.It also facilitates the negotiations between two parties.In the P / E model,the most critical is to determine two indicators through industry analysis and business analysis: PE multiples and net profit.On the other hand,there is no absolute standard answer in the primary market valuation.More is the game playing at the transaction level,depending on expectations of future earnings of both parties.Through the valuation negotiations,both sides compromise to find a balance point in the game playing.