Research On The Motivation And Performance Of Regional M&A And Reorganization Of Local State-owned Enterprises Under The Background Of Supply-side Reform

In November 2015,the Central Economic Work Conference formally proposed the concept of "supply-side structural reform",which guided the development of state-owned enterprises.M&A and reorganization of state-owned enterprises,as a means of "supply-side reform",the results were not satisfied.However,there are few cases of state-owned enterprise M&A and reorganization with the theme of supply-side reform.Besides,most studies only focus on the company’s performance,without in-depth and systematic research on the mechanism of state-owned enterprise M&A and reorganization on supply-side reform.It is vital to explore the mechanism of state-owned enterprise mergers and acquisitions.As its achievement can be a "key channel" to implement state-owned enterprise mergers and acquisitions,and also connects supply-side reform.In this way,it will play a guiding role in deepening supply-side reform.This article will use BBMG Group’s acquisition of Jidong Group as a research example.The focus will be its internal M&A motivation,performance,and influence mechanism from the direction of regional state-owned enterprises’ in local mergers and acquisitions.Besides,this study can also provide a reference for Chinese supply-side reform.Based on the topic of M&A and reorganization,the first part of this article is to review the related literature and theories of motivation and performance evaluation of M&A and re-organization.Based on the topic of M&A and reorganization,this article reviews the related literature and theories on the motivation and performance evaluation of M&A and reorganization.In the context of supply-side reform,combined with the national strategic intention of regional coordinated development,the research on the merger and reorganization of local state-owned enterprises is divided into company level and regional level.This article selects the merger and acquisition of BBMG Group and Jidong Group,two local state-owned enterprise groups that are mainly engaged in cement in the same economic region,as an example.First,under the background of regional integration and related industrial policies,the two local state-owned enterprises are merged and reorganized.The necessity and purpose of the Based on the purpose of advancing the supply-side reform,the article starts from the company-level motivations,constructs the performance impact mechanism of suggested price capability and synergy,and analyzes the company-level financial indicators from the perspective of supply-side reform.From a regional perspective,the article analyzes the motivations for mergers and acquisitions of local state-owned enterprises.It also combines supply-side reforms and regional integration policy to explore the factors in constructing the capacity adjustment,market price competition,technological innovation,and industrial concentration.Finally,it will evaluate the results of local state-owned enterprises under the effect of supply-side reform in regional mergers and acquisitions on excess capacity,industry profits,industrial structure,and industrial concentration.Through the above analysis of the case of BBMG Group’s acquisition of Jidong Group,the author found that regional M&A of local state-owned enterprises can improve bargaining power at the micro-enterprise level,reduce overall enterprise costs,enhance market competitiveness,improve asset-liability structure,and enhance enterprises Financial performance level: From a regional perspective,local state-owned enterprise mergers and acquisitions can synergistically resolve excess capacity in areas covered by their forces,increase industrial concentration,increase regional industry profits,promote regional industrial structure optimization,and effectively promote supply-side reform.This study combines the background of supply-side reform to establish a systematic evaluation mechanism in regional state-owned enterprise’s mergers and acquisitions from the enterprise level and regional level,and to provide reference suggestions for future state-owned enterprises’ mergers and acquisition.