Study On The Method Payment Of Shenkai Merger Based On The Application Of Earnout

Xu Jianbo(2019)found in his research that my country's current M & A payment methods are very simple,mainly based on cash payments,and lack the richness and innovation of the payment structure.The disadvantage of this emphasis on cash payment methods is that companies ignore the risks posed by cash payments,resulting in large amounts of cash expenditures or increased debt burdens that affect the company's financial situation.As an innovative M & A payment method,the profitability payment plan has gradually been discovered due to its unique advantages and entered the domestic M & A arena.Since the profitability payment plan can pay the equity transaction consideration in installments,which is more conducive to the valuation of the M & A party,most of the relevant theoretical research conclusions on the profitability payment plan in China believe that it has a positive impact and is conducive to improving the efficiency of M & A.This article studies the M & A payment of Shenkai shares based on the profitability payment plan.When Shenkai Co.,Ltd.adopted the profitability payment method for mergers and acquisitions,although it agreed with the merged party before the transaction and set up an agreement to pay the equity transfer consideration in installments,it finally chose to perform the transfer agreement in 2017.The core question studied in this article is: Before opening the merger,Shenkai chose to use the profitability payment plan for mergers and acquisitions,but it actively gave up the agreement.What is the reason? The core issues are decomposed from this: First,how the profitability payment plan affects Shenkai before and after the merger and acquisition;second,what are the problems that Shenkai shares have in the implementation of the profitability payment plan.Based on the above research questions,the research ideas of this paper are as follows: This paper first sorts out the research results of existing research scholars on the payment methods and profitability payment plans in the process of mergers and acquisitions,and then reviews the application of Shenkai Shares' profitable payment plan and the acquisition of Hangzhou Fenghe.The actual process,and then study the short-term and long-term impact of Shenkai M & A payment,and in-depth analysis of the actual problems of its payment methods,and finally put forward targeted and perfect countermeasures to the profitable payment plan.This article uses the event research method and financial ratio to analyze the shortterm financial impact and long-term financial impact of Shenkai's M & A payments,and finds that no matter whether it is short-term or long-term financial conditions,M & A payments have no positive impact.This article specifically analyzes the implementation of the profitability payment plan and finds that there are many problems,including greater financing risks,excessive acquisition of merger and acquisition risks by the merger and acquisition,performance evaluation indicators are too single,or there is no system guarantee for delayed payment,and the installment payment time is set too long The allocation of management authority is unclear,and the valuation of transaction consideration is too high.Finally,this article puts forward perfect countermeasures for the future profitability payment plan.On the one hand,it is hoped that enterprises can make better use of the profitability payment plan to achieve the goal of corporate mergers and acquisitions;on the other hand,it is hoped that the relevant departments can pay attention to profitability payment and improve their rules and regulations,which is conducive to the development of my country's capital market.