Study On The Cross-border M&A Of Enterprises:Motivation And Market Effect

The development of Internet technology and hardware facilities in China has promoted the rise and growth of the game industry in China.Many enterprises compete for the game market and want to occupy a leading place in the game market,but the achievement is not decided by the time of entering the market,but by the game research and development technology,therefore,the R& D technology has become the main projects that enterprises compete for.Because enterprises need to invest a lot of time and money in the research and development of game products,it is uncertain whether the final research and development results will be accepted by the market.Therefore,in the game industry,many enterprises prefer to acquire the game products or semi-finished products that have been developed by mergers and acquisitions,instead of independently developing new game products,as a result,large enterprises compete to merge and acquire small-and medium-size game enterprises,and obtain technical support and market share by the way of mergers and acquisitions.Based on the increasing number of Internet game enterprises and mergers and acquisitions year by year,studying the motivation and performance of Internet game enterprises' M&A can help to find out the specific driving factors of the implementation of M&A,and also help to select a more reasonable performance evaluation method in the study on Internet game enterprises.Make an analysis of the motivation and market effect evaluation of Chinese enterprises' oversea M&A from the perspective of market has important guiding significance for Chinese enterprises to implement overseas M&A.This paper focuses on the motivation and market effect of mergers and acquisitions of Internet game enterprises.Firstly,the paper collects the relevant literature related to enterprise Merger & Acquisition,constructs the overall framework of the paper,and analyzes the motivation of Merger & Acquisition by combining the existing relevant theories with the case of Tencent merging the game company Riot Games.Then,the paper chooses the event study method to analyze the short-term market effect of this M&A case,and analyze the long-term market effect by using the economic value added and market value added.It is concluded that this M&A has not been recognized by the market in the short term and has not brought the expected benefits,but it can bring huge profits and increase market share in the long run.Finally,the conclusions and suggestions drawn from the summary analysis of the case,such as the implementation of M&A should have a long-term strategy and should not only focus on shortterm profits,but also respect the awareness of the acquired party and retain autonomy in overseas M&A integration,hoping to be helpful to Chinese enterprises' overseas M&A.