Research On The Motivation And Performance Of Haier’s Cross-border Merger And Acquisition Of Candy

With the development of ’economic reform and open up’ and economic globalization,the contact between countries and enterprises have become closer.More and more enterprises have participated in international activities.‘The go globally strategy’,‘The Belt and Road’and a series of foreign investment policies have created a good environment for companies’ overseas activities.China’s economy is developing rapidly.Chinese companies are actively participating in international competition in order to catch up with the trend of internationalization.The number and value of cross-border mergers and acquisitions have also increased rapidly.The value of mergers and acquisitions has grown from US$12.67 billion in 2007 to US$68.6 billion in 2019,and the number of mergers and acquisitions has increased from 2007.The 35 cases in the country have grown to 591 cases,indicating the rapid development of my country’s transnational activities.In 2019,my country’s overseas M&A focused on the high-end industrial chain,and the destination was mainly in Asia,with the mergers and acquisitions value reaching 22.3 billion US dollars,accounting for 30%;followed by Europe,with the mergers and acquisitions value reaching 20.53 billion US dollars.The home appliance industry is a traditional industry in my country with fierce domestic competition.As a leading company in the home appliance industry,Haier actively participates in overseas mergers and acquisitions in order to gain a competitive advantage.The acquired company Candy in this article is located in Italy.It is one of the leading professional home appliance manufacturers in Europe and has a large market share in the European market.Due to the scale of this cross-border mergers and acquisitions and the respective industry positions of both parties to the merger,this article chooses this case for research,which can provide some suggestions for other Chinese companies’ cross-border mergers and acquisitions.The article combines actual case with theories about cross-border mergers and acquisitions to analyze the motivation and performance of Haier’s acquisition.This article introduces the relevant background,theory,case introduction,case analysis and case conclusion through five parts.It first introduces the background of overseas mergers and acquisitions,summarizes literature,introduces the concepts of motivations and performance of overseas mergers and acquisitions and finally elaborates the research content of this article.The second part is case introduction.It introduces the respective situations of Haier and Candy,as well as the background and characteristics of mergers and acquisitions.The third part is the motivation of mergers and acquisitions.The acquisitions aim to increase profitability,increase overseas revenue,obtain synergies,strengthen its European market layout,realize globalization strategy and enhance global brand influence.The performance analysis mainly through event research method,financial indicator analysis and non-financial indicator analysis.Haier’s profitability,growth ability,market share and brand value have been improved after the merger.The fifth part is the conclusion of the case:First,the goal is basically achieved.With the help of Candy,it successfully opened the European market.Due to Candy’s high market share in the field of intelligent interconnection,Haier’s global brand influence and growth ability have been greatly enhanced.After the merger,the scale of the company,the operating gross profit margin,the operating income,the operating profit and total assets all grew rapidly.Thirdly,the synergy effect and the globalization strategy are realized.Haier’s "Rendan Heyi" model has been recognized by Candy,which has greatly improved the management efficiency after mergers and acquisitions.In addition,Haier’s integration of resources in the whole process of logistics,service and products have successfully brought into play the coordination of procurement and finance.Haier ’s overseas market share has greatly increased.Among the 8.9%of Chinese white goods brands in the overseas market,Haier’s contribution rate reached 71%.In addition,in overseas mergers and acquisitions such as Casarte,GE and Fisher&Paykel,Haier has successfully realized its global business strategy.Finally,the enlightenment of this article is drawn.Enterprises should select target companies for mergers and acquisitions,formulate corporate strategic plans,and integrate resources.