Research On Merger & Acquisition Development Trend Of Chinese Steel Industry And Countermeasure

The paper starts with analyzing the actuality of Chinese steel industry development, and expounds that it is of great necessity for Chinese steel industry to implement the M&A strategy and of huge value to research the M&A strategy of Chinese steel enterprises, based on posting the problems such as low industry centralization and combining the objective practice of M&A becoming important strategy during the development of foreign and domestic steel industry. After reviewing and summarizing theories on enterprise M&A strategy and their current development such as scale economy, synergy, transaction cost, under-evaluation, market power and diversification strategy, the paper analyzes the incentive and specificity of Chinese enterprises' M&A; based on which, the model of Chinese enterprises' M&A, including the methods of target enterprise selection and M&A implementation is then put forward. The paper states in detail the necessity and feasibility of Chinese industry M&A through the study on issues generated during the development of iron & steel industry. The case study of iron & steel enterprise' M&A both at home and abroad shows what Chinese steel enterprises can learn from. Through the introduction of Nanjing Steel's expansion and M&A strategy, we realize the importance of M&A strategy to future development of steel industry, and this paper designs the roles and strategies that suits for government and steel enterprises of different type in steel industry M&A. Meanwhile, the paper further explains that steel enterprise's M&A is the only way for Chinese steel industry development.The whole framework of the paper is following:The first chapter is foreword. This part expounds the necessity of Chinese steel industry M&A strategy implementation, the sense of subject selection and value of this research, through analyzing the actuality of Chinese steel industry and the history of international steel industry.In the second and third chapters, enterprise M&A theory introduction, behavior analysis and history retrospection are accomplished. Chapter 2 is the research on M&A theory and incentives, which includes reviewing of seven main theories of M&A, introducing the latest research result of incentives and selection of enterprise M&A mode, and all these serves for the research on steel enterprises' M&A. Chapter 3 is behavior influence and development history of enterprises' M&A, which researches steel enterprises M&A evolvement, and review the history of enterprises' M&A development.In the forth and fifth chapters, evaluation mode of M&A target enterprise is set up and steel enterprises' problems are expounded. Chapter 4 is the research on enterprise M&A mode and target enterprise selection, via the analysis of steel enterprises' M&A, setting up M&A selecting strategic mode of Chinese steel enterprise, putting forward or improving the selecting evaluation mode of target enterprise in steel enterprise M&A and designing enterprises' M&A method. Chapter 5 studies the trend and existing problems of Chinese steel industry development, on the base of retrospection, analyzes the change of supply and demand, and forecasts the development direction and reveals the existing problems during the development of Chinese steel industry.Chapter 6 and chapter 7 demonstrate the necessity and feasibility of M&A, and introduce the typical case. Chapter 6 researches the necessity and feasibility of Chinese steel industry M&A, introduces the international steel M&A trend and specific M&A strategy, proves that the basic step to solve many contradictions during the development of Chinese steel is M&A, and supply assistance to necessity analysis of M&A strategy; meanwhile, cites the research conclusion of McKinsey company to Chinese steel industry development and descript the feasibility of steel enterprise M&A development. Chapter 7 is the case study on successful steel industry M&A, which tells us what Chinese steel enterprises can learn and puts forward a series of proposal to steel M&A. Chapter 8 and chapter 9 are NISCO development introduction and the study of M&A Countermeasure of iron & steel enterprises. Chapter 8 gives the actual case of NISCO expansion as well as the development. The feasibility of applying the M&A strategy by iron & steel enterprises under the macro state policy is further explained through the case, and from that realizes the importance of M&A to steel enterprises' future development. Chapter 9 focuses on the study of M&A countermeasures and development prospect. The countermeasures to M&A applicable to various iron & steel enterprises are designed; the idea that the government should render support through policies is put forward; and expects that Chinese iron & steel industry will be among the strongest in the world, which will come true in the near future.Chapter 10 is the conclusion. The prospect of Chinese iron & steel industry M&A is made. The conclusions and contributions of this research are as follows: (1) Abstractly analyzes the motivation of steel industry implementing M&A, expounds the necessity and feasibility of Chinese steel industry implementing M&A, and reveals objective principle for China steel industry coming into new M&A developing period.(2) Analyzes selection mode of steel industry M&A, describes establishment of steel enterprise developing strategy and target enterprise selection, enriches SWOT strategic model with steel enterprise strategic M&A feature, then for the first time designs out a set of filtrating evaluation model applicable to steel target enterprises, which supplies the applied tool for practical operation.(3)This paper's analysis proves that the basic egress of China steel industry is to increase industry concentration ratio, and the most effective way to increase industry concentration ratio is restructure, merger and acquisition, thereby concludes that steel industry will take on the general trend of restructure, merger and acquisition.(4)This paper analyzes typical M&A cases at home and abroad in detail as well as the case of Nanjing Iron&Steel Co., Ltd. Meanwhile, draws successful developing experiences from domestic and overseas steel enterprises, and puts forward tens of strategies and proposals to all types of steel enterprises.It is worthy of being mentioned that this paper puts forward a set of evaluation model combination to steel industry M&G as a innovative way; the paper formats GREE model and EER model for target enterprises evaluation, which are of high operation and applicability, meanwhile creatively applies the inter benefit model and logistic evaluation model of steel enterprises to M&A analysis, not only evaluating steel target enterprises' level among steel section, but also firstly using steel enterprise logistic evaluation model, supplies a more complete systematic evaluation way for steel enterprise implementing strategic M&A.