Research On PE Impact Mechanism And Its Economic Consequences In Cross-border M & A

With the advancement of globalization,the economies of countries all over the world are highly correlated.Belt and Road Initiative,has been adopted in order to meet the new trend of the times and to realize the basic national policy of going globally;however,due to many difficulties in cross-border M & A,many Chinese enterprises’ cross-border M & A ended in failure.PE(private equity),short for private equity investment,is an investment method of non-public trading equity.Then,in the process of cross-border M & A of Chinese enterprises,can PE solve the problem of cross-border M&A? If so,how does PE help Chinese enterprises achieve successful cross-border M& A? What are the economic consequences of cross-border M & A by enterprises using PE? What experience are worth learning from cross-border M & A of Cooperation between Chinese listed companies and PE? This paper will answer the above questions through case study.Based on this,this paper will analyze the case of cross-border M & A of LEDVANCE by Mullinson Co.,Ltd.(SZ.002745).Firstly,this paper combs the relevant literature of cross-border M & A and PE,and introduces the theoretical basis of the research and the current situation of cross-border M & A by Chinese enterprises using PE.Secondly,this paper introduces the specific situation of case participants and case process,and makes an in-depth analysis of the impact mechanism of PE in crossborder M & A.Finally,this paper analyzes the economic consequences of the case from three directions: value creation effect,market response and synergy effect.After analysis of the case,this paper finds that enterprises face capital problems,information evaluation problems,foreign institutional environment constraints and M& A integration problems in the process of cross-border M & A.In view of the above problems,the impact mechanism of PE is as follows in each stage: before M & A,PE can provide enterprises with sufficient financial support and comprehensive information evaluation;In M & A,PE establishes a special purpose vehicle to avoid cultural and legal risks for enterprises;After M & A,PE and enterprises form a community of interests to help enterprise M & A integration.Based on the above impact mechanism,this paper finds that cross-border M & A by using PE can realize value creation,obtain positive market response,realize positive synergy and produce positive economic consequences.This paper adopts the single case study method and selects a relatively novel classic case for research,which has practical significance.This paper comprehensively analyzes the process of cross-border M & A by using PE and the impact mechanism of PE in cross-border M & A,evaluates Mullinson ’s value creation ability from three aspects: economic added value,industrial value and innovative value,and evaluates the market response by using event research method,which has certain theoretical significance.