The Performance Study Of Friendship Shares Merging Bailian Shares

Currently, M&A as an important way of merger is widely used in various types of mergercases. The case that friendship co., combine Bailian co., is representative; this case is a typicalsuccess story of the merger in full circulation background. This paper will focus on theperformance. In-depth analysis of this case can provide advice to other companies, as well hasa very important practical significance.The first chapter introduces the research background, research on domestic andinternational M&A performance, and describes the research methods and details.The second chapter introduces the basic situation of the two companies; then it analyzes themotives of mergers and acquisitions, mergers and acquisitions obtained five motives; then itdescribes the process of mergers and acquisitions, and details the merger plan, merger andacquisition process, the reasonableness of the exchange ratio; Finally, it simply presents theresults of mergers and acquisitions.The third chapter analyzes the performance of friendship shares via event study and factoranalysis method, the following conclusions: in the short term, both of them have gained apositive wealth effect; but in the long-term, the friendship shares cannot make sustainablewealth effect for the shareholders. This also shows that friendship shares do not get a goodlong-term financial performance through mergers and acquisitions. Then this paper uses factoranalysis method to analyze the long-term financial performance of friendship shares bybuilding models from four aspects, and find the cause of poor performance of the long-termperformance.Finally, by calculation and analysis, following results are obtained: both of them get a hugeshort-term financial effect; and get a poor long-term financial performance, but in the futurethere will be a good development. Then this paper puts forward the promotion experience,and then gives enlightenments for friendship shares.