Research On The Motivation And Effect Of Cross-Industry M&A In Education Industry

In 2014,President Xi Jinping mentioned that China has entered a new normal economy for the first time,and then stimulated enterprises to transform and upgrade.At the same time,with the continuous development of Chinese economy,people's demand for education is constantly upgraded and new requirements are put forward for the education industry.Meanwhile,the introduction of "two-children" policy and the continuous popularization of people's concept of "lifelong education" greatly stimulate the demand for education.In order to meet the market demand,the country unceasingly introduces the corresponding policy to promote the education reform,and to standard education market.As a result,the revised "private education promotion law" was introduced,the barrier between capital and education was broken,and many non-education enterprises tried to enter the education industry through cross-industry M&A.According to the author's statistics,29 of the 40 M&A transactions in the market were initiated by enterprises in the non-education industry in 2016.However,after the cross-border M&A,some of the company performance fairly well,while others not.Therefore,this paper looks for the motivation,analyzes the performance of the cross-border M&A to the education industry and try to find out the factors that related to the performance and puts forward Suggestions for cross-industry M&A of educational targets.Firstly,this article shows the situation of cross-industry M&A to the education industry in Chinese market.And the encourage of government,transportation to find new profit point,synergistic effect,diversified spread risk and the irrational decision of managers are the factors that motivate the cross-industry M&A to the education industry.And according to the analyzes of the 16 cross-industry M&A's to the education industry,they don't performance as well as we expected.And then the author put forward the idea that government policies and industrial environment,the strategy of M&A and the acquisition integration play important roles in the afteracquisition performanceSecondly,this paper takes Shengtong's acquisition of Lebo education as an example to analyze the motivation and performance of the cross-industry M&A to education industry.And according to the above Analyze,we try to find out the reason why this acquisition performance well.Finally,this article summarizes the motivation and the performance of crossindustry M&A to education industry and offers the suggestions based on the factors influencing the performance.This article is trying to provide some suggestions to the cross-industry M&A to education industry and remind the investors the reality of the acquisitions boom to avoid blind investment.