Based On The Value Of Synergies To Create Cross-border Mergers And Acquisitions

Cross-border M & A accounts for a large part in foreign direct investment, it is an important way for enterprise to be globalizes and more competitive.The fast growth in number and scale of cross-border M&A cases makes the value creation study about it to be a significant issue.Cross-border M&A improves the competitive advantage and core competence through acquiring synergy. This paper analyses the forms that synergy creating value, dividing the synergy into three types: operating synergy, management synergy and financial synergy, discussing about the recognition and realizing system of each synergy. In addition, synergy calculation model is also being researched, and then the paper chooses Free Cash Flow Increment to make quantitative analysis of the case value creation.The paper chooses two cases:Mittal and Arcelor M&A, TCT and Arcatel Mobile Phone M & A, studying the value creation from qualitative and quantitative angle. The case study showes that, the former one gets the positive value, while the later gets the negative value from 2004 to 2008. Through cross-cases study, finding out the problems in TCT case and enlightments of Mittal case.