Analysis On Continuous Mergers And Acquisitions Of Enterprises Based On Entropy Change

Since Shenzhen and Shanghai Stock Exchange established,more and more public corporations have taken part in mergers and acquisitions(M&A) through Chinese capital market.Thus many scholars have been concerned about what happened about M&A,and why so many corporations joined continiously,even how they could do better in M&A.The entropy theory announces that the development of material is negative.Entropy will development toward increment of direction in the closing of the system.But when enterprise becomes an open economy system,under the instruction of entropy theory,it will form a kind of spread structure.This kind of structure has two functions of negative feedback and positive feedback.Two functions can keep the enterprise off balanced appearance forever.Under this kind of appearance,the entropy of enterprise will be minimum.Based on the complex system of "enterprise-society-nature",the article starts to research.During my study,we use the entropy theory to analyse the characteristics of enterprise.We think that M&A is a better way to keep open,because it can absorb nagtive entropy and release positive entropy.M&A can break partly balanced kind,and exchange material and energy with the external world constantly.The motive of M&A is to pursue minimum entropy.Based on the entropy theory and enterprise characteristics,we have analysed the behavior of M&A.Holding the close contact of "enterprise-society-nature",the article has established serials of indexes based on the entropy theory.Some indexes are on entropy,some indexes are on category entropy,others are on financial indexes.In the meantime,we cluster and analyse whether these financial indexes are fit to category entropy.The result enunciates that what we have established is suitable.After dealing with these indexes scientifically,we can analyse the correlation between M&A and indexes.Even more,we can predict what the enterprise will happen about continuous M&A.First,we make use of parameter and non-parameter to exam the classification rationality between period merger type and continuous merger type.Second, we apply the logistic regression to exam the correlation between M&A and entropy change. Our examination indicates that their correlations are strong.For example,the tallest is to -19.499 and the lowest is to 4.567.At the end,we use the logistic regression to exam the predication of entropy change model.The examination appears that its predication is stronger than only constant model.Because the former is 88.3%,the latter is only 51.6%.So,we can conclude:Each public corporation which participates M&A can use four categories entropy to describe its characteristic and motive.Four categories entropy are oxidize entropy,revivification entropy,supported entropy and pressure entropy.The continuous M&A of each each public corporation is related with four categories entropy change.The four categories entropy have stronger prediction ability.