Study On Internal Influencing Factors And Economic Consequences Of Payment Choice In Cross-border M&A

With the rapid development of China’s economy and the increasing strength of enterprises,in the past few years,Chinese enterprises have begun to expand the scale of overseas markets and enter the international market as their goal.The upsurge of cross-border mergers and acquisitions has followed.According to statistics,the number and amount of transnational mergers and acquisitions have increased dramatically since 2014,reaching its peak in 2016,with the amount of transnational reaching 210.4 billion dollars.The case of Tencent M&A Supercell discussed in this paper belongs to a big cross-border M&A in TMT industry,which has a certain research reference value.Some successful overseas mergers and acquisitions enterprises will encounter many problems in the follow-up integration process,which will affect the normal development of enterprises,or even drag down enterprises.This phenomenon may be due to the fact that enterprises choose payment methods that are not suitable for enterprises in the process of mergers and acquisitions.There are many factors affecting the payment mode of M&A.This paper focuses on the analysis of internal factors on the impact of M&A payment methods.Firstly,this paper analyses the current situation of payment methods of cross-border M&A in China,and finds that 90%of enterprises adopt cash payment methods in M&A transactions.Secondly,on the basis of previous scholars’ research,this paper takes Tencent M&A Supercell case as an example,uses case analysis and literature induction to study the internal factors affecting the choice of payment methods in cross-border M&A,and draws the following conclusions:①Tencent’s M&A purpose is a basic premise of choosing cash payment;②Tencent’s financial situation is a necessary condition for choosing cash payment;③Tencent’s shareholder control is the fundamental reason for choosing cash payment;④The size of M&A and the relative transaction size promote the choice of cash payment.Thirdly,this paper analyses the economic consequences of the choice of payment in the case of Tencent’s M&A Supercell,mainly analyses the impact on stock market,finance and non-finance,and draws the following conclusions:①The stock market is very optimistic about Tencent’s cross-border M&A Supercell case in the short term,which brings great dividends to Tencent’s stock market in the long run;②Through the analysis of the related financial data of Tencent’s M&A transaction using cash payment method,it is found that the cross-border M&A transaction has achieved synergistic effect,which has brought tremendous benefits to Tencent and strengthened the company’s comprehensive strength;③After analyzing the control right and the later integration of M&A transaction by cash payment,it is considered that the adoption of cash payment in this cross-border M&A is in line with the actual situation of Tencent.Finally,through the analysis of Tencent’s M&A Supercell case,this paper summarization and induction the conclusions,suggestions and prospects for Chinese enterprises’ future cross-border M&A and M&A payment mode selection,in order to enable Chinese enterprises to develop overseas M&A business better and faster in the future and occupy a place in the international market.