Research On Value Effect Of Serial M&As Under The Pan-entertainment Strategy Orientation

With the improvement of national income level and the cultivation of content payment consciousness,people’s demand for cultural and entertainment is increasing.The government also strongly supports the development and upgrading of cultural and entertainment industry.At the same time,the development trend of the industry has gradually shifted from single entertainment forms such as games and films to the pan-entertainment ecological system featuring multi-sectoral linkages.Serial M&As and investment have become the main development path for the industry to expand its scale and realize the pan-entertainment strategic layout.However,after 2018,the regulation is tightened,the capital tide is ebbing,the industry bubble appears,and many companies that have achieved high growth through serial M&As have suffered from a series of problems,such as goodwill impairment and performance decline,etc.Then,in recent years,whether the serial M&As of pan-entertainment companies have really created value,or caused value destruction?Zeus Entertainment is a typical company that implements the panentertainment strategic layout through serial M&As in the game market segment.This paper takes a series of mergers and acquisitions initiated after its listing in 2014 as the research object and analyzes the value effect after serial M&As.Firstly,the literature related to serial M&As behavior and M&A performance is sorted out,on this basis,the relevant concepts of serial M&As are defined,Based on the value destruction theory of M&A,the causes of value destruction of serial M&As were analyzed in comparison with ordinary M&A.Secondly,Secondly,the case introduction and case analysis.Elaborated the pan-entertainment industry background,the motivation and process of serial M&As.In the case analysis part,the value effect of serial M&As is quantified and evaluated comprehensively from the three dimensions of market effect,financial performance and business performance.Thirdly,combined with the aforementioned theoretical analysis framework,this paper makes an in-depth discussion on the impact mechanism of the value destruction of serial M&As from four aspects,namely,the selection of the target before merger and acquisition,the financial ability in the implementation,the resource integration and the behavior of managers.Finally,based on the above analysis,the research conclusions are drawn as follows :(1)the serial M&As of Zeus Entertainment can create certain market returns and external growth in the short term,but fail to obtain the positive value effect in the long term,resulting in the destruction of the firm’s value;(2)the causes of the value damage mainly exists in the M&A target choice blindness,seriously overvalued the targets,too aggressive on the financial payment,the lack of effective post-merger integration,defects in corporate governance mechanism,managers are motivated to arbitrage;(3)compared with ordinary M&A,serial M&As are more likely to cause value destruction of the firm due to the strategic relevance and cumulative effect.Through the in-depth analysis of Zeus Entertainment,this paper summarizes the general experience of pan-entertainment industry which takes serial M&As as the development path.And in the hope of providing reference for companies in the same industry and promoting the sound development of the industry.