Research On The Motivation And Performance Of M&A In The Industry Chain Of W Company

With the rapid development of China’s semiconductor industry,the competition in related markets is becoming increasingly fierce,coupled with insufficient mastery of key technologies,which has led to difficulties in the development of China’s related industries.In order to reverse this passive situation,the National 2030 Plan and the "14th Five Year Plan" National R&D Plan have clearly identified the third generation of semiconductors as an important development direction in China,and proposed that from 2021 to 2025,China will assist in the comprehensive development of the semiconductor industry in research and innovation,financing and development.In addition,the government has established various types of preferential policies such as industry investment funds and tax exemptions.China is currently the world’s largest semiconductor market,with a strong and growing demand for related products.In order to stand out in the increasingly fierce market competition,more and more semiconductor companies choose to improve their industrial chain and enhance their competitive strength through mergers and acquisitions.Therefore,this article explores the M&A behavior of individual companies in the semiconductor industry,explores the motivation and performance of the company’s M&A,and excavates relevant experience to provide reference for other M&A entities.This article selects W Company in the semiconductor industry as the research object of industrial chain mergers and acquisitions.Firstly,it elaborates on the relevant concepts and theoretical foundations of industrial chain mergers and acquisitions,and organizes and reviews literature on the motives and performance of mergers and acquisitions.Then,the specific process of W Company’s industrial chain mergers and acquisitions was introduced,and the motivations for its mergers and acquisitions were explored.Then,the market performance,financial performance,and non-financial performance of its mergers and acquisitions were studied separately.Among them,the paper uses the event study method,BHAR method and Tobin Q value to evaluate the market performance of M&A;And measure financial performance by combining relevant indicators from four levels: operating income,profitability,research and development capabilities,and cash flow;And analyze the impact of mergers and acquisitions on the non-financial performance of the case company through three aspects: synergy,strategic transformation,and overseas market expansion.Finally,the study found that industry chain mergers and acquisitions are beneficial for improving corporate performance,helping companies achieve strategic transformation,and exploring overseas markets;At the same time,in order to enhance the effectiveness of industry chain mergers and acquisitions for enterprises,this article proposes several guiding suggestions: firstly,target enterprises should be selected that are consistent with the strategic goals of the enterprise;secondly,attention should be paid to early investigation and the selection of suitable merger and acquisition opportunities;The third is to attach importance to resource integration after the completion of mergers and acquisitions to generate synergies.Industry chain mergers and acquisitions have important practical significance for enterprises seeking transformation and upgrading.A sound industrial chain can enrich the product categories of enterprises,expand their market share,and expand the industrial chain upstream to bring synergies and other advantages to mergers and acquisitions companies.This article studies the M&A behavior of a single company,clarifying the specific reasons for conducting industry chain M&A based on its own conditions,the process of implementing the M&A,and the enterprise performance after the M&A,providing some reference for relevant companies to carry out strategic transformation.