Research On The Negative Influence Of Longwei Media's Levera-Ged Acquisition Of Wanjia Culture

Relative to Western countries,the development of leveraged mergers and acquisitions in China is relatively late.In 1978,China began to implement reform and opening up,and the market economic system was gradually established.Therefore,in the early 1990s,leveraged mergers and acquisitions were introduced to China.After the introduction of China,due to the unclear property rights of state-owned enterprises,the property rights structure reform was urgently needed to realize the diversification of property rights.Therefore,leveraged mergers and acquisitions were first tried in state-owned enterprises.It was found that leveraged mergers and acquisitions led to the loss of state-owned assets,so the state suspended the promotion of leveraged mergers and acquisitions,and the development of leveraged mergers and acquisitions slowed down.In addition,the leveraged mergers and acquisitions conducted before the 21st century are mainly foreign-funded enterprises.In 2010,Geely Automobile applied leveraged M&A mode to acquire Volvo,marking the official entry into the era of domestic M&A.Scholars'research on leveraged mergers and acquisitions mainly focuses on the risks of leveraged mergers and acquisitions,financing,etc.In view of the failure of leveraged mergers and acquisitions,some scholars analyze the risks and consequences of leveraged mergers and acquisitions.In general,after every failure of leveraged mergers and acquisitions,without exception,it has a great negative impact on both leveraged mergers and acquisitions and capital markets.However,there are not many research cases that specifically analyze this negative impact.This paper selects the case of Longwei Media's leveraged merger and acquisition of Wanjia culture to study the negative impact of the failure of leveraged mergers and acquisitions.First of all,this paper introduces the relevant theories of leveraged mergers and acquisitions,choose transaction cost theory,capital structure theory,value underestimation theory as the theoretical basis of this paper.Secondly,Longwei Media acquired the control of Wanjia Culture for 3.059 billion yuan and ended up failing the transfer of control rights.The essence of this leveraged merger is to leverage the shell company to acquire the listed company to achieve the backdoor listing.The shell resource is the Wanjia culture.Based on this,the paper analyzes the reasons why Longwei Media has failed to leverage and acquire Wanjia culture from the root cause,the enterprise itself and the external environment.Thirdly,from the three perspectives of Longwei Media,Wanjia Culture and Capital Market,the negative impact of the failure of leveraged mergers and acquisitions was studied.Finally,in response to the negative impact of the failure of leveraged mergers and acquisitions,the corresponding countermeasures and suggestions are proposed.The research in this paper aims to enrich the relevant literature on leveraged mergers and acquisitions,especially the related research on the failure of leveraged mergers and acquisitions.At the same time,it proposes to the regulatory authorities and leveraged mergers and acquisitions to avoid the negative impact of leveraged mergers and acquisitions,and provides reference and reference for other leveraged mergers and acquisitions in capital market transactions.