A Study On Up&Down-Stream Industries Contagion Effect Of Horizontal Mergers And Acquisitions

Under the guidance of national policy of mergers, acquisitions and reorganization, mergers and acquisitions become a significant measure for corporate to expand rapidly in lost cost. Since2006, the introduction of Acquisition management of Listed Companies and draft of Antimonopoly Act provide trade program for domestic mergers and acquisitions, contributing to market brisk. Listed companies integrate qualified assets and digest excess capacity through horizontal mergers and acquisitions, leading to this merger occurs continually in up&down-stream industries. There are theoretical studies on horizontal mergers and acquisitions, mainly corporate as research subject, while with little authoritative interpretation from the respective of industrial network.Based on the fact of horizontal mergers and acquisitions appearance in many industries, this thesis studies on the up and down-stream industries contagion effect of horizontal mergers and acquisitions, and lengthways contagion effect of industrial correlation and control on horizontal merger, with listed companies merger and reorganization data in2003-2012as research sample, and China national input-output data in2007.This thesis finds out:(1) Horizontal mergers and acquisitions has a positive effect on that in up and down-stream industries, meaning that there’s contagion effect of horizontal mergers and acquisitions in up and down-stream industries.(2) The more correlation between up and down-stream industries and target industry, the more horizontal merger effect on lengthways contagion.(3) When target industry and up&down-stream industries industry are both regulated, the contagion effect of horizontal mergers and acquisitions on up&down-stream industries is not supposed to be obvious. When target industry and up&down-stream industries industry are both unregulated, the contagion effect of horizontal mergers and acquisitions on up&down-stream industries is supposed to be obvious. The research shows that horizontal mergers and acquisitions of target industry presents itself as a result of industrial environment reaction, partially influenced by correlative industry horizontal mergers and acquisitions. Therefore, horizontal mergers and acquisitions inflect and spread in industrial network.The study mentioned above not only theoretically enriches corporate mergers and acquisitions motivate and contagion, but also practically provides valuable reference and guidance for relevant policy. The introduction of horizontal mergers and acquisitions contagion effect is beneficial for government to put industrial network into consideration when making policies on corporate merger and reorganization. Under the circumstance of considering target industry scale and upgrade, this study offers convenience for government’s effective industrial adjustment policy formulation and implementation, and also makes the best use of market in eliminating backward industry, promoting industrial construction and optimization.