Research On The Motivation And Performance Of M&A Of Agrochemical Enterprises

Agrochemical enterprises are upstream enterprises that provide agricultural products and agricultural technology services for agricultural production,and are an important support for ensuring a country’s food security.In the past few years,under the continuous pressure of environmental protection and safety in the agrochemical industry,various enterprises have begun to focus on improving R&D and reducing costs,so as to improve the market access threshold,thus further increasing the concentration of the agrochemical industry.Driven by the "One Belt,One Road" initiative,some leading Chinese agrochemical companies have launched global strategic layouts,integrated industrial chains through M&A,achieved synergies,enhanced their core competitiveness such as technological innovation capabilities,broadened resources and sales channels,and helped enterprises Bigger and stronger.This article takes the case of Chem China’s acquisition of Syngenta as the research object to analyze the motivation and performance of the merger.By reading a large number of relevant materials and sorting out domestic and foreign literature,the research ideas have been determined,and the motivational analysis of the merger and acquisition behavior of agrochemical enterprises is carried out in combination with the theory of synergy effect,the theory of industrial agglomeration,the theory of core competitiveness and the theory of economies of scale.The basic situation of Chem China and Syngenta was introduced,the process of merger and acquisition was reviewed,and the motive of the merger was mainly analyzed.The analysis of M&A performance mainly starts from three dimensions.First,this paper uses the financial indicator method to analyze the main financial indicators of Chem China during the M&A period from 2015 to 2020;The impact of this merger on its market development prospects and other aspects;finally,this paper analyzes the performance before and after mergers and acquisitions through EVA analysis method,improves the shortcomings of traditional financial index evaluation methods,and makes the content in the capital cost factor.The analysis is more complete,and the performance changes are deeply explored,and strive to obtain a comprehensive and comprehensive evaluation result of Chem China’s merger and acquisition performance.The study found that:(1)Mergers and acquisitions produced certain synergies.From the perspective of non-financial performance,mergers and acquisitions under the integration of the industrial chain have improved the R&D and innovation level of Chem China,enabling Chem China to have a complete pesticide industry chain,and its market share has continued to expand globally.Its corporate value and brand value Steady growth,with the help of Syngenta’s customer base,expand sales channels and maximize the benefits of industrial chain integration.(2)The financial performance of enterprises after mergers and acquisitions is not satisfactory.In addition to the increase in operating income,gross profit margin and other indicators of Chem China’s acquisition,other key financial indicators have declined to varying degrees,resulting in a substantial decline in profitability and growth capacity.Due to the expensive cash consideration to be paid in the acquisition of Syngenta,Chem China’s huge debts have also affected its solvency invisibly,which will undoubtedly have an impact on the operation and development of Chem China.(3)The economic value created by mergers and acquisitions is unstable.The performance of Chem China before and after mergers and acquisitions from 2015 to 2020 was analyzed through the economic value-added method.It was found that the EVA value of Chem China increased significantly in the year of mergers and acquisitions,but the EVA value dropped significantly in 2018,and the EVA value after 2019 The value has gradually recovered,which shows that the value created by mergers and acquisitions for Chem China is unstable,and this instability is caused by the external environment and internal factors of the company.