The Synergistic Effect Assessment Of Weichai Power Merger Yaxing Bus

M&A activity between enterprises can achieve a resource allocation and route redistribution process,also, it is an important way to the fast-growing business. With the developing of the economicglobalization, the development of China’s market economy become more and more active, more andmore state-owned enterprises, collective enterprises and private enterprises are currently facing theintegration and restructuring of resources to achieve the goal of profit maximization problem. To solve theproblem of the integration and restructuring of resources to achieve optimal allocation of resources, is oneof the important ways to solve the M&A activity between enterprises. The most fundamental purpose ofthe acquisition of the company is to obtain a synergistic effect of mergers and acquisitions, which iscurrently being theorists and the industry generally accepted view. Due to the distortion of reality mergersynergies assessment also led to the failure of many mergers and acquisitions activity. Thus, a company inorder to obtain rapid growth through successful M&A activity is necessary to understand and evaluate thesynergies arising from M&A activity. Based on the theory of inductive study abroad synergies of themerger, the concept of synergy to be described and discussed theoretically generate synergies arising fromthe development process, introduced the traditional way of business valuation net income and net did notconsider the time value of money and future earnings yield risk when evaluating the presence of onlyreflect changes afterwards shareholder value and other defects, these defects may lead companies can notmake the optimal decision making, which may also make the company short-term behavior and affect itslong-term sustainable development strategy.In addition this article also introduced a synergies assessment methods EVA,which is increasinglyrespected theoretical origins of combing and introduced EVA into practice the assumption and the notionthat the economic value added EVA (Economic Value Added) is seen as a measure of a an organization ofeconomic value and wealth creation measure, in number, EVA is equal to net operating profit after taxminus the cost of capital, is part of the residual income after all costs are deducted, it reflects on theeconomic significance of the company rather than the accounting sense earnings pointed out on whether theuse of EVA is calculated and evaluated during the calculation shall appropriate such as interest expenses, research and development expenses adjustments, non-recurring income and adjustments in constructionprojects adjusted accordingly, from the production and management of synergies synergy management,financial synergies specifically addressed three aspects of mergers and acquisitions EVA reflects synergiesand compared to conventional concrete manifestation of the effects of mergers and acquisitions synergiesassessment methods, these advantages is embodied in the more traditional meaning assessment method issimple, easier to understand, be able to reflect the real value of the enterprise, the two basic principles ofbusiness decision-making will be able to better integrate financial go, the results can be more effective andaccurate evaluation of the various departments can warning financial deterioration.This paper argues that EVA assess mergers and acquisitions synergies in terms of the more traditionalassessment methods merger synergies more significant advantages compared to traditional assessmentmethods more conducive to reflect production operations to the enterprise merger synergies, managementcoordination effects and financial synergies. Based on the practice of mergers and acquisitions amongChinese enterprises, selected Weichai meigered Yaxin as sample cases and calculated the EconomicValue Added of Weichai Power and Yaxing Bus before and after the acquisition, through the analysis ofboth the economic value added in the mergers and acquisitions front changes assessed whether the mergerbrings to both parties expected synergies and discussed on the basis of government involvement, andmerger and acquisition activities related laws, regulations and policies, corporate organizational integration,employee psychological contract, and other macro-scale mergers and acquisitions and micro factorsaffecting synergistic effect achieved concrete manifestation of M&A activity.