Case Study Based On The Cross-Industrial Merger Of Mindata

Under the background of China's economic transition and upgrading,cross-industry mergers boom is rising and continues to heat up among listed companies since 2015.On the one hand,because the traditional industry has been overcapacity,companies at the bottleneck stage of development are seeking transformation one after another.They try to find new profit growth point to survive by means of developing new business through cross-industry mergers.On the other hand,the government-led industrial policy adjustment is also an important reason why there are many large state-owned companies try to do cross-industry mergers and many small state-owned companies try to make themselves as targets.However,since 2017,the mergers boom has been cooling down for the SFC continuously releases a stricter policy signal of cross-industry mergers.The main cause why many companies' cross-industry mergers are negated are their excessive performance commitments and uncertain sustained profitability.According to the statistics data of Wind,there are nearly 30% of the companies failed to achieve their performance commitments,which exposes the risks and contradictions of the cross-industry mergers.The cross-industry mergers of different companies are different,so some issues related to mergers are worth to be discussed in microscopic case.Mindata as a typical case of cross-industry merger which translated from traditional manufacturing industry to digital marketing industry and achieve transformation from heavy assets operation mode to light assets operation mode,has certain analytical value in guiding other companies.This paper try to analyse the case of Mindata deeply,by analysing its reason,selection basis,preparatory measures,characteristics of the process,integration measures and the result of the merger,in order to explore the critical factor of the cross-industry merger.At last,this paper offers three proposals for Mindata.It should continute to do business Innovation and Upgrading in order to prevent the industry risk,and should Strengthen the integration measures in order to prevent the goodwill impairment risk,and also should maintain the healthy development of traditional business.At the same time,this paper concludes some enlightenments for companies which want to do cross-industry merger,including reasonable evaluation of the development prospects of original business for making sure the real demand,reasonable choice of targets combining their own strength and the characteristics of the industry market,necessary preparatory measures in order to reduce risk,accurate valuation for keeping down the cost,appropriate payment method which is favor of follow-up development,performance commitment with positive and negative incentive and necessary integration measures.