Research On Motivation And Effect Of Sunlight Shares’ Performance Commitment In M＆A

Mergers and acquisitions,as an important means for enterprises to expand their scale and extend their industrial chain,are more and more widely used in the capital market.Because the information held by the acquirer is at a disadvantage compared to the acquiree,and the future operation level of the target company is uncertain,it is difficult for both parties to reach a consensus on the transaction consideration and cannot protect the rights and interests of the acquirer.Introduce performance commitments.The original intention of performance commitment is to promote the smooth progress of mergers and acquisitions,and at the same time to motivate and restrict the management of the acquiree,so as to improve the performance of the target company and achieve a win-win situation.But as the application of performance promises continues to deepen,so does the problem.The problem of high valuation and high premium in mergers and acquisitions has brought about higher performance commitments,making it difficult for the acquiree to complete the performance commitment goals.If it cannot be achieved,it will not only damage the rights and interests of investors,but also have an adverse impact on the business development of the enterprise.Today,more and more companies still sign performance commitments under the circumstance that the completion rate of performance commitments is getting lower and lower.The motivation and effect of companies choosing to sign performance commitments has become an important topic.This paper adopts the case study method and selects Sunlight Shares’ acquisition of My Gym as a research case.First,it analyzes the motivation of Sunlight Shares’ signing of performance commitments,and summarizes the expected effects that Sunlight Shares expects to achieve by signing performance commitments.Then,it analyzes the consequences of performance commitments from the three dimensions of M＆A goodwill,synergy and market response.From the perspective of M＆A goodwill,it analyzes the effect of performance commitment valuation and corporate goodwill impairment.From the perspective of synergy,analyze the operational synergy,management synergy and financial synergy after the merger,and judge whether the signing of the performance commitment enables the enterprise to achieve post-merger synergy.From the perspective of market reaction,the event research method is used to analyze the market’s reaction to the company’s signing of performance commitments and the changes in the company’s stock price after signing performance commitments.Finally,summarize the difference between the actual effect and the expected and analyze the reasons.Based on the above analysis,this paper draws the conclusion that the effect of performance commitment is easily affected by many factors.Factors such as the external macro environment and the setting of performance commitment terms will affect the realization of performance commitment.It is difficult for high valuation and high premium mergers and acquisitions to send positive signals to the market.Investors take a wait-and-see attitude on whether high performance commitments can be completed;the M＆A premium is higher than the failure compensation,and performance commitments are difficult to play an incentive and restraint role.Finally,according to the above analysis results,the enlightenment of signing the performance commitment in the merger and acquisition is obtained,hoping that the performance commitment can play a more active role in the merger and acquisition.