Research On The Influence Of Different Payment Methods On Enterprises' M&A Performance

In today's society,mergers and acquisitions have become a way for companies to rapidly expand and enhance their competitiveness.Whether the M&A can bring wealth to the enterprise depends on many factors,and the choice of M&A payment methods plays a key role.On the one hand,the choice of payment method can change the cash flow endowment and asset structure of the enterprise,thereby affecting the operation of the enterprise;on the other hand,the difference in payment methods can also affect the conversion of corporate asset forms and taxation.The payment ultimately affects the business performance of the company after the M&A.Therefore,in order to achieve the intended purpose of mergers and acquisitions,enterprises should carefully consider the choice of payment methods,and judge the characteristics of the enterprise itself and the status of the industry.The pharmaceutical industry is the sunrise industry.The momentum of mergers and acquisitions has been heating up since 2013.Many pharmaceutical giants in the industry have chose mergers and acquisitions,and industry consolidation has become prominent.Domestic scholars have less studies on the pharmaceutical industry as a specific research object,and the impact of M&A payment methods on the performance of pharmaceutical companies has not yet appeared.Therefore,in order to reflect the impact of different M&A payment methods on the M&A performance of pharmaceutical companies,this paper takes 50 M&A events in the pharmaceutical industry from 2010 to 2015 as the research object,and combines 11 mergers and acquisitions of Fosun Pharma from 2012 to 2017 to do case analysis.Firstly,this paper introduces the theoretical basis of M&A payment and the definition of related concepts,and reviews the domestic and foreign literature.Secondly,empirical research is carried out to establish a financial indicator system to examine the long-term performance of mergers and acquisitions,and factor analysis is used to study the impact of different payment methods on M&A performance.Finally,taking Fosun Pharma as an example and conducting an in-depth analysis of 11 cases of mergers and acquisitions,and studying the factors and performance that affect the choice of M&A payment methods.The main conclusion of the study is that the impact of different payment methods on M&A performance is not the same.The three payment methods have a certain improvement in the performance of the year of merger and acquisition,and the mixed payment is better than the equity payment,then the equity payment is better than the cash payment.However,there are differences in the performance of the three payment methods from the first year after the M&A activities.The performance of the first year after the M&A is improved under the cash payment method,but it has dropped sharply since the second year;Under the stock payment method,there is a certain decline,but from the second year,there is a substantial increase in corporate performance;the changes of performance under the mixed payment method is between the two payment methods,combining the two methods' pros and cons.In addition,under the equity payment method,the positive proportion of M&A performance is significantly higher than the other two payment methods.Therefore,it is concluded that the long-term performance of pharmaceutical companies using the equity payment method is better.