Case Analysis On The Motivation And Effect Of Hezong Science Technology Acquired Yacheng And Pengchuang

M&A is an important means in the business process of a company.The effect of a company's implementation of M&A is directly related to the development prospects of the company.A successful merger can promote companies to survive in the fierce competition,improve their competitiveness,and create synergies with the company.Hezong Science&Technology is a leading enterprise in the transmission and distribution equipment industry.Since the establishment of the company,the company has maintained a good operating income.In 2015,the company's operating income growth rate was 21.84%,But in2017,the operating income growth rate increased to 67.15%.The rapid development of the company's has a close relationship with the company's acquisition of Hunan Yacheng and Jiangsu Pengchuang.What is the reason for Hezong Science&Technology to implement this M&A? What are the effects of M&A on the company? These problems are worth studying.This thesis discusses the reasons and effects of the acquisition of Hunan Yacheng and Jiangsu Pengchuang,and finally summarizes the experience that other enterprises can learn from.The thesis uses the method of case study.First of all,introduced the research background and research significance of the thesis.Secondly,arrange the literature on M&A motivations and M&A effects.Then,introduce the relevant theories and method of evaluating effects.Next,based on the case of Hezong Science&Technology acquired Hunan Yacheng and Jiangsu Pengchuang,based on the analysis of the status quo and challenges of transmission and distribution equipment industry,the M&A activities of Hezong Science&Technology were analyzed in detail.The motivation of the analysis shows that Hezong Science&Technology acquired Hunan Yacheng in order to achieve multichannel management and enter the field of energy storage.The acquisition of Jiangsu Pengchuang is to extend the industrial chain of the enterprise and strengthen the main business.At the same time,the thesis evaluates the M&A effect of Hezong Science&Technology from the perspectives of shareholder wealth effect,financial synergy,business synergy and economic added value.The thesis found that a large positive abnormal rate of return occurred before the M&A announcement date,and the market had better expectations for the event.However,after the event day(opening),a negative abnormal return occurred,which became normal on the seventh day after the event.Thefinancial synergy and operational synergies of the M&A of the company have brought positive effects,and the economic value added of the company has also been improved.Finally,the thesis summarizes the experience and enlightenment that can be obtained from this M&A,and provides reference for other companies in the same industry.The research of the thesis can be used as a reference for enterprises in the transmission and distribution equipment industry that is seeking transformation,which helps enterprises to find new profit growth points and select suitable target enterprises,thereby promoting the sustainable development of enterprises.