Research On Vertical Value Chain M＆A Of Tayho Advanced Materials

With the growth of corporations,the scale of corporations will continue to expand.In recent years,China is committed to industrial transformation,and the economic situation is declining as well as the market demand,which causes competition in the market becomes increasingly fierce.In this case,many corporations tend to strengthen their competitiveness in the market and avoiding risks through various ways.Among them,many corporations choose to exert their influence on the vertical value chain of the industry through M＆A（Merger and Acquisition）.Due to the motives of M＆A are different,so the M＆A effects they hope to achieve are also different.How to evaluate the M＆A behavior combined with different motives? Or how to weigh the short-term,long-term benefits,financial performance and non-financial performance of M＆A behavior? And how to avoid the shortsighted behavior of management? Corporations and investors have to face and solve these three problems.Therefore,how to combine the characteristics of M＆A to evaluate the effects of corporations after M＆A in the vertical value chain is particularly important.This article uses case study method and comparative analysis method based on entropy weight TOPSIS method.Firstly,this article starts research on the relevant literature of corporation M＆A performance evaluation and corporation value chain M＆A in China and abroad.Then the research status at home and abroad are summarized,which indicates it is hard for current research to combine financial performance with non-financial performance.Instead,scholars usually use quantitative financial performance and qualitative nonfinancial performance for analysis.Based on this research and summary of previous literatures,choosing the Tayho Advanced Materials’ vertical value chain M＆A Metastar in2019 as the research object.Through studying the current situation and characteristics of China’s corporation vertical value chain M＆A,This article constructs a performance evaluation index system based on the performance evaluation index system of SASAC.This system evaluates the effects of M＆A from profitability,operation ability,long-term and short-term combination of solvency,growth ability and non-financial performance.Then,the entropy weight TOPSIS method is introduced,and the entropy weight method is used to weight each index objectively.After determining the weight of each index,the TOPSIS method is used to comprehensively score the performance changes after Tayho Advanced Materials’ M＆A.After comprehensively evaluating the performance of Tayho Advanced Materials,it is found that the vertical value chain M＆A has brought positive impact to it,but this impact is relatively slight.In order to explore the reasons,a further study on the index changes in combination with the operation of Tayho Advanced Materials is necessary.It is found that Tayho Advanced Materials has exposed some problems in addition to the advantages of bargaining advantage,cost control and cash flow increase through this M＆A.These problems include the decrease in operating income,single product variety,low asset utilization efficiency and increased risk of short-term debt repayment of corporation.Suggestions and countermeasures are put forward for each problem.Finally,this article summarizes the benefits and problems of Tayho Advanced Materials through this vertical value chain M＆A,which can be used as a reference for future corporations in M＆A.This article makes an in-depth research and evaluation on the performance of Tayho Advanced Materials’ vertical value chain M＆A of Metastar.And puts suggestions to solve the problems,which is conducive to Tayho Advanced Materials’ improvement of its own shortcomings after the M＆A.This research can also provide some experience references for the M＆A activities of other corporations.