Study On Pricing Of Aim Company Based On Real Option Theory

M&A is inevitable trend of development of economic globalization, by which enterprise can acquire large-scale production and reduce the business risk. Meanwhile, it can also promote adjustment of the industrial structure, optimize resource distribution of the society, and improve competitive power of the whole economic.The process of M&A is very complex and the key problem is Pricing of Target Company, thus it determine whether the M&A success or not. As the growing of M&A, especially the appearance of strategic M&A, the uncertainty of investment opportunity is becoming bigger and bigger. Real option is a method using option pricing model to appraise assets with option characteristics and it perfects the evaluation theory.This thesis's main content including the following parts: fist, analyzed the traditional Pricing of Target Firm, concluded its shortcoming and put forward the pricing of real option method. Then this thesis discussed the flaw of the existing option pricing model of Target Firm and pointed the direction of improvement. After that it put emphasis upon analyzing the recognition and choose of real option in M&A, according to the difference between financial M&A and strategic M&A, established different Pricing of Target Firm model to them based on pricing of real option. At the same time, it analyzed the application conditions and application difficulties and matters needing attention of real option pricing of Target Firm. Finally, we approved that the established model is true through an example and comparison with traditional method.