A Study On The Motivation And Performance Of "Listed Company + PE" M&A Fund Established By AIER Ophthalmology

With the rapid development of China’s economy and the influx of capital into the market,listed companies choose to expand their industries through mergers and acquisitions in order to seize market development opportunities and further improve their market competitiveness.In 2011,Silicon Valley Paradise and Da Kang Pastoral jointly invested in the establishment of the first "listed company + PE" type M&A fund in China.This new model not only provides a channel for industrial transformation and upgrading of companies,but also relieves the pressure of PE investment projects to exit at maturity,resulting in a mutually beneficial and win-win situation between listed companies and PE institutions.This model was soon noticed by the Chinese M&A market,and under the guidance of national policies,it is gradually becoming one of the mainstream M&A modes in China’s capital market.However,this new model has been around for a relatively short period of time,and has been studied more qualitatively in the academic field.We also need to study in depth whether the joint establishment of industrial M&A funds by listed companies and PE institutions has a long-term positive impact on the performance of listed companies,and whether this new model can truly promote the development of listed companies in a meaningful way.Based on this,this paper selects AIER Ophthalmology,a leading company in the medical industry,as the research object.This paper firstly compares the reference domestic and international literature,and explains the relevant concepts and theories,then introduces the situation of AIER Ophthalmology,and introduces the operation process of AIER Ophthalmology fund from four aspects: establishment of fund,investment target,post-investment management and fund exit,and finally digs out the motivation of AIER Ophthalmology to set up an industrial M&A fund,and the financial and non-financial performance of the company before and after the M&A.For short-term financial performance,this paper uses the event study method to select two M&A funds for analysis,while for medium and long-term financial performance,this paper uses the financial indicator analysis method and the economic value added method,and in the financial index analysis,in addition to the vertical time series comparison,this paper also selects three comparison enterprises for horizontal comparison.The study found that the establishment of a ’listed company + PE’ M&A fund has a positive effect on the short and medium to long-term performance of the company,helping it to achieve its strategic goal of market expansion.Through the case study of AIER Ophthalmology,this paper suggests that listed companies should evaluate their own situation before adopting the "listed company + PE" M&A fund model,choose a suitable PE institution to cooperate with in the process of adopting the new M&A model,and pay attention to integration management after merging into the target company.