A Study On The Financial Performance Of Sinocare's Cross-border Continuous M&A

With the continuous strengthening of economic globalization,Chinese companies' cross-border M&A transaction turnover and quantity have been increasing rapidly.Small and medium-sized listed companies are more and more keen to go global,and cases of continuous M&A occur from time to time.However,according to some report,the financial performance of cross-border M&A of many companies is not ideal.Therefore,this thesis regard how to analyze and improve the financial performance of cross-border M&A as a research issue has important reference value for companies.This thesis takes cross-border M&A of Sinocare Inc.as an example,and mainly focuses on the analysis of financial performance.The aim is to improve the company's financial performance after cross-border M&A.PEST model is adopted to analyze macro-environment of Sinocare's cross-border M&A in the thesis,and the motivation and modes of M&A will be discussed.This thesis also uses event-study method and accounting study method to analyze the influence brought by M&A on shareholders' wealth and financial performance respectively.Findings show that the motivation of Sinocare's M&A is to implement internationalization strategy,seek brand and technology,expand market share and seek operating synergy.In the macro environment,political and legal factors,economic environment factors and technological environment factors have a positive effect on the performance of Sinocare's cross-border continuous M&A,while social and cultural factors will exert negative impacts.Sinocare's cash-purchasing acquisitions,horizontal M&A and LBO all have a beneficial effect on the M&A performance;analysis of event study shows that Sinocare's cross-border M&A detract from shareholders' wealth in the short term;and analysis of accounting indicators shows that Sinocare's cross-border continuous M&A has reduced the profitability of the company in the medium term,and solvency,operating capacity and development capacity have no significant increase.Based on the above analysis,this thesis gives the following suggestions for Sinocare to improve it's financial performance after cross-border continuous M&A:Clarify M&A integration strategies;Open up global sales networks to achieve business synergy;Enhancing R&D capabilities and apportion R&D expenses;Controlling the production costs of M&A targets;Establishing a converged financial management system and optimize capital structure;Seeking tax planning.