Study On The Synergy Of Merger Between Shanghai And Nanjing Automobile Groups

With the increasing development of the global market economy, more and moreenterprises take advantage of mergers and acquisitions as a tool to expand thebusiness scale, centralized production and capital, realized the growth of enterprisescale and performance. Although there are many cases of mergers and acquisitions athome and abroad at present, but because of the complexity of M&A,it leads to thehigher failure rate, the truly successful completion of the acquisition cases accountedfor only a minority of cases, this one of the important reason is the importance of aprior assessment of the pre-merger companies and a comprehensive post-mergerintegration neglected, resulting in a lack of inter-enterprises collaboration or limitedsynergistic effect after the merger. Bur the merger and acquisition activity in ourcountry, there are also not consider the phenomenon of synergies, the more commonmanifestations of the blind pursuit of diversification or hot industry, backdoor listing,non-substantive reorganization and other.At the same time, our country enterprise economic behavior is in the prosperousdevelopment of mergers and acquisitions, mergers and acquisitions in the marketstrading volume shows a tendency of rapid growth. In recent years, our countryautomotive industry’s contribution to economic growth is increasing, but due to thepursuit of economies of scale of the auto industry, to narrow the gap between Chinaand developed countries, the rapid expansion of business scale approach is to conductinter-industry mergers and acquisitions. In this paper, Shanghai Automotive GroupCo., Ltd.(hereinafter referred to as SAIC) acquisition of Nanjing Automobile GroupCo., Ltd.(hereinafter referred to as NAC) as a case study to analyze the mergersynergies are realized.Firstly, this article summarized the related theory of synergistic effect, whichprovide a theoretical basis for the subsequent analysis. Then it made specific analysisabout the cooperation between SAIC and NAC, the synergies arising from theacquisition to be identified, and from enterprise financial data and economic valueadded perspectives to verify this cooperation on the merger synergies, and the mergersynergies have different performances in operations, finance, management aspects.According to the arrangement and analysis of the cases, it is concluded that thecooperation between SAIC and NAC has realized the merger synergies in the shortterm, and this article pointed out that the key lies in identification of the targetcompany before the merger and effective integration of post-merger.