Financial Performance Analysis Of Enterprise M & A Under The Background Of Manufacturing Transformation

The 13 th five-year plan period(2016-2020)is a crucial period for the country’s major scientific and technological infrastructure construction and a decisive period for the building of a moderately prosperous society in all respects.Scientific and technological innovation,industrial transformation and upgrading,and the development of the real economy are key tasks.Manufacturing industry is the basic industry of national economy.Especially in the context of supply-side reform,the demand for transformation and upgrading of traditional manufacturing industry is increasingly strong.In the face of global warming and increasingly serious smog,green manufacturing is an inevitable trend for Chinese manufacturing to shift to the high-end market as the need of ecological development.Changes in the market environment and regulatory environment have brought new challenges to enterprises.Mergers and acquisitions have become an important means for Chinese enterprises in the process of optimizing resource allocation and capital expansion.Despite the surging tide of mergers and acquisitions in China,the huge gap between the cost of mergers and acquisitions and the financial performance of enterprises after mergers and acquisitions has become the main reason for the low success rate of mergers and acquisitions.The main reason is that it is difficult to solve the financial problems in the process of merger and acquisition.In the process of mergers and acquisitions,although the price of mergers and acquisitions is the core of the process,the financial performance of enterprises after mergers and acquisitions is the key to the success rate of mergers and acquisitions.There are mainly two kinds of merger and acquisition results: one is that it is difficult for enterprises to realize the cost after merger and the decline of economies of scale,which reduces the operational efficiency of business and market;The second is to reduce the cost and economies of scale.At present,China is in a critical period of industrial transformation.The low value-added industry represented by the manufacturing industry urgently needs the introduction of new and high technologies to reduce the production cost and improve the financial performance of enterprises.In this paper,the acquisition of Indonesia’s PT Sokoria geothermal company(SGI)by Zhejiang Kaishan Compressor Co.,Ltd.(hereinafter referred to as Kaishan)is selected as a case study,so as to conduct in-depth research on mergers and acquisitions performance from a micro perspective under the situation of traditional manufacturing transformation.On the basis of analyzing the motivation of merger and acquisition,this paper introduces the main body of merger and acquisition,the geotherm company and the process of merger and acquisition in Indonesia from the perspective of industrial background and innovation environment.Then,the financial data of Kaishan from 2015 to 2019 were selected to study the financial performance of Kaishan.It was found that Kaishan basically achieved the goal of improving its financial performance through merger and acquisition.After implementing the merger strategy,the performance was consistent with the expectation and the merger was relatively successful.This paper studies the success of Kaishan’s merger and acquisition of SGI geothermal company in Indonesia to assist the transformation,so as to provide reference and experience for other enterprises in the transformation of green manufacturing in China to make scientific decisions and provide constructive Suggestions for the value creation of enterprises after merger and acquisition.In the process of financial performance measurement,there are mainly two methods: the time study method and the financial index method.In the process of measuring the financial performance of an enterprise through the financial index method,it mainly measures the operating,financial and management coordination of the enterprise.Analysis of the development trend of enterprise financial performance for the enterprise’s operation,finance,management and other aspects have a comprehensive grasp;In-depth understanding of its development trend.China’s capital market is mature and there is a lot of time for mergers and acquisitions.This paper summarizes the financial performance of Kaishan in the process of geothermal mergers and acquisitions in Indonesia with the financial performance method,which provides a theoretical basis for China’s manufacturing transformation.The results of this paper show that in the manufacturing industry,it is feasible for traditional enterprises to use mergers and acquisitions strategy to achieve diversified operations or achieve the goal of transformation and upgrading.Mergers and acquisitions act as an effective channel for traditional enterprises to quickly enter new fields,enterprises can quickly improve profit growth in new business,at the same time,reduce operational risks,especially in this rapidly changing era,mergers and acquisitions is an effective and important channel for transformation and upgrading.In manufacturing industry,in the traditional company to further implement the strategy of transition to upgrade situation,exist such as mergers and acquisitions should be implemented by the goal setting and national macro policy,the choice of mergers and acquisitions target companies,a large number of mergers and acquisitions performance influence factors such as macroeconomic cycle,the existence of the above factors from multiple aspects brought certain influence on the performance of mergers and acquisitions performance,every link is particularly important.Mountain with Indonesia geothermal company merger and acquisition activity to produce good performance in the market reaction,as well as to provide referential experience for manufacturing enterprises,for the "made in China 2025" how to optimize manufacturing enterprise technological innovation behavior,break through high-end technology lock in the developed countries,promote innovation performance to provide theoretical basis and convincing empirical evidence.At the same time,after the merger and acquisition of Indonesia geothermal,the financial performance of Kaishan was greatly affected within two years,indicating that the measures taken by Kaishan in the merger and acquisition process were inappropriate and affected the development of the enterprise.For example,entrepreneurs are blindly confident,fail to grasp the opportunity of merger and acquisition,and fail to carry out effective integration in the later period.