Research On Financial Performance Of China Resources 39 Merge And Acquisition Of Guilin Tianhe

With the rapid development of the pharmaceutical industry in recent years,there appears the characteristics of high investment,high risk,high technology and high added value in the pharmaceutical industry,all of which are the reasons to determine that there is only one way for pharmaceutical enterprises to develop------mergers and acquisitions,if they want to shorten their time for development.There are certain risks in M & A,if the two sides of M & A can not produce synergy after M & A,it will have a greater impact on the production and operation of both sides.The most direct way to measure the success of M & A is to judge by the financial data in the performance of M & A.For different M & A performance,each focuses on different points of view,and gets its own judgment on the success of M & A performance.The most important way to evaluate the performance of M & A is to judge by the financial data before and after M & A.Therefore,this paper selects this case: China Resources 39 merger and acquisition of Guilin Tianhe to evaluate the performance of M & A.Analyzing financial data by means of case analysis.In the case,we get an idea on whether value is created after China Resources 39 merger and acquisition of Guilin Tianhe after studying the case.Firstly,the background,research significance,research methods and main contents of the topic are expounded,and the related theoretical concepts are explained in the essay.Secondly,the paper introduces the current situation of M & A in Chinese medicine industry.Finally,it introduces the case of merger and acquisition of Guilin Tianhe by China Resources 39,and the conclusion obtained from the case.The emphasis is on the case analysis of the merger and acquisition of Guilin Tianhe by China Resources 39 in the three parts.The case analysis mainly expounds three issues: 1.The quality analysis of business capital,operating cash flow and free cash flow.An enterprise without cash flow can not go on even if it has a good financial index,so the quality of operating cash flow is crucial to the continuous operation of an enterprise.Through the calculation of cash flow quality,this part analyzes the influence of M & A on the cash flow of enterprises.2.The financial index method and the EVA economic added value method are used to analyze the performance of the merger and acquisition.The financial index method adopts four indexes of operation ability,debt repaymentability,growth ability and profitability to compare with two standard enterprises,and the financial performance of China Resources 39 after the merger and acquisition comes out.The result show that the EVA method mainly calculates the economic added value through the net profit after tax and capital cost 3.After the merger and acquisition of China Resources 39,the future value of the company is evaluated.The future value assessment of the company evaluates the stock value of China Resources 39 through the method of its own cash flow and the relative valuation method,so as to judge the relationship between the enterprise valuation and its actual value.Through the calculation and analysis of three aspects,we have a profound understanding of the operating performance after the merger of China Resources 39.Through these analysis: we can get these conclusions:1.China Resources 39 has health cash flow,merge and acquisition of Guilin Tianhe didn't bring bad influence to China Resources 39;2?Financial performance is positive but it's not obvious through the method of financial indicators and EVA method;3.After merge and acquisition of Guilin Tianhe,China Resources 39 use their own cash flow to merge and acquisition in the situation of continuing operation,they didn't use method of orienteering and financial leverage to merge and acquisition.China Resources 39' moderate operating policy attracts more and more investor to focus on it.So the value of enterprise and the value of investment can increase on long term.Because of the characteristics of high risk in pharmaceutical industry,some financial institutions are unable to invest in this industry on account of their low risk preference.This case analysis above could show these financial institutions which elements should be noticed when investing this industry.The case analysis method can put the theoretical knowledge into practice.My understanding of financial performance and cash flow gets deepened after analyzing the case.