Differential Game Strategy Of Cooperative Mergers And Acquisitions Considering The Behavior Of Government And Two Bidders

Mergers and acquisitions are an important way for corporate development.Government usually concerned about M&A.Compared with the large number of M&A,the success rate of M&A is low.Data shows that 70% of global M&A is failed.Under this background,the bidder cooperation as a new M&A model has emerged.This new M&A model not only disperses the risk of M&A,but also raises new challenges.There are many issues that need to be study further,such as the conditions of cooperation,the scheme of income distribution,the mode of cooperation,the mode of cooperation incentive and the degree of M&A effort.In order to improve the success rate of M&A,it is necessary to study the bidder cooperation in M&A.And this study brings disappointment aversion,fairness,altruism,government behavior and bidder cooperation into the unified analysis framework.It calculates the results under different decision-making modes,compares the results and verifies the validity of the model through numerical simulation.The existing literature has paid attention to the influence of government behavior and irrational behavior on M&A decision.But there is a lack of research on cooperative bidders,disappointment aversion,fairness and altruism on M&A decision.The research on M&A is mostly aimed at single bidder,which can not effectively guide the actual situation.And the application of differential game in the field of M&A is less.This article conducts a study of cooperative bidders in M&A on the basis of the above research.It is of great significance to enrich the relevant literature and guides the practice.The main tasks of this study are as follows:First,the reserach defines the concepts of cooperative M&A and government behavior.This study introduces the theory of M&A synergy effect,M&A transaction cost,differential game theory and behavioral finance theory.Based on M&A synergy theory,M&A transaction cost theory and differential game theory,the differential game model is constructed.The disappointment aversion,fairness and altruism are studied according to behavior finance theory.Second,in the chapter of considering the government behavior,a differential game model is constructed.The equilibrium strategy,optimal trajectory of M&A synergy effect,profit of both bidders and system profit are calculated.The centralized decision-making is the optimal decision-making mode.Cost-sharing decision-making model can effectively coordinate the M&A system under decentralized decision-making.Further research is needed in order for the two bidders to voluntarily conduct centralized decision-making.Under three decision-making modes,consumer policy preference has incentive effect on government M&A investment and has no effect on M &A investment.Third,this paper studies cooperative bidders considering disappointment aversion.As a result,centralized decision-making is superior to cost-sharing decision-making model and decentralized decision-making.A one-way cost-sharing Stackelberg game can improve the results of decentralized decision-making.The degree of disappointment aversion has inhibitory effect on M&A effort level,M&A synergy effect,respective profits and system profits.Fourth,this paper studies the influence of fairness under government subsidy on M&A and altruism under government intervention on M&A.The research in this chapter is based on the model that does not consider fairness and altruism.Government subsidy is the direct sharing of part of the cost by the government.Government intervention means that the government stipulates that the two bidders share part of the cost for each other.The results show that fairness can inhibit the level of M&A effort.Altruism can promote the level of M&A effort.Altruism is a positive social preference.It can improve M&A performance and promote the system profit.This paper studies the level of M&A effort from the dynamic perspective.It establishes a differential game model of bidder cooperation and analyzes different decision situations in dynamic environment.It tries to find an optimal cooperation mechanism.The aim of the study is to improve the overall M&A performance,enrich the literature and provide theoretical basis for M&A market in practice.