The Performance Study Of CITIC Securities Co.,Ltd. Acquiring CLSA

According to statistics from the Ministry of Commerce,China's total foreign investment has reached $1.88 trillion by mid-2018.As Chinese enterprises gradually move towards the global market,capital intermediaries accompanied by them have begun to expand overseas.In 1997,CICC first set up a branch in Hongkong.China Merchants Securities incorporated China Merchants Securities(Hongkong)Limited in 2005.Subsequently,various domestic securities companies have set up branches in Hongkong and other overseas areas.By the end of 2017,31 securities companies,24 fund companies and 19 futures companies had set up,acquired or participated in overseas operations.According to Vander data,in 2017,15 securities companies listed on the mainland securities companies made overseas business income,a total of 20.448 billion yuan,accounting for 6.96% of the total revenue of mainland listed securities companies,up 0.34% from 2016.With the development of overseas business of securities companies in China,the research on the motivation and effect of overseas M&A of securities companies has attracted the attention of many experts and scholars.This paper is written in the autumn of 2018,on the fifth anniversary of CITIC Securities' acquisition of CLSA.At this critical point,the effect of the acquisition of CITIC Securities on CLSA-the impact of research,has certain practical significance.As a large number of scholars have studied the motivation of M&A,this paper will no longer study the motivation of M&A,but will focus on the effect of the acquisition of companies.This paper analyzes and evaluates the effect of this overseas merger and acquisition case through the method of event study and accounting study.CITIC Securities as a separate group of research objects,the other four large domestic securities companies Guotai Jun'an,Haitong Securities,Huatai Securities,Guangfa Securities as a reference group,comparative analysis of whether the merger and acquisition of CITIC Securities in economic indicators,non-economic indicators have brought positive and negative effects.The results show that:(1)In the five-year period after CITIC Securities merged CLSA,it did not bring corresponding competitive advantages compared with the other four large domestic securities companies;(2)CITIC Securities liquidity management was under significant pressure due to the overseas M&A.Indicators of net capital risk management showed a significant decline;(3)The overseas mergers and acquisitions brought about certain challenges to the regulatory management of CITIC Securities.