Alpha M&A Performance Study

Mergers and acquisitions allows rapid development of enterprises. Enterprises can seize the market quickly and expand the size of the company through mergers and acquisitions. In July 2005, the first M&A in the field of culture is Focus Media mergered Framedia. Since 2010, the government has issued a series of policies to encourage the development of cultural industries. The development and growth of cultural industries has been raised to a new level. Because the support and encourage of the government, cultural field has been prosperous since 2013. People considered 2013 as "the first year of mergers and acquisitions" in the field of culture. The trend continued in 2014 and 2015. Until December 25, 2015, there were 166 cases of M&A in the field of culture. The number was slightly higher than in 2014. Removing the unpublished amount, M&A scaled up to 149.904 billion yuan.The paper analyzes the characteristics and motivations of cultural industries by combining the theory of M&A and choose Alpha Animation(renamed to Alpha Entertainment in April 1, 2016) as a case to analyzes its process of M&A since 2010 and explore its motivation. By event study, selecting each 15 days before and after the event as a window period to calculate its CAR and study its short-term M&A performance. Choosing some index of debt-paying ability, operating capacity, earning power and development capability to study the M&A financial performance by accounting research method and compare with the other enterprise.The results of the paper is that Alpha got new vitality and opportunities through M&A. The M&A performance of Alpha had a good market response. Short-term performance increased significantly and the aspects of financial indicators were also performed well and was superior to the same enterprise. The motivation was also well done. The paper has the following conclusions:(1) Through the M&A, Alpha expanded the income.(2) Alpha was involved in the gaming industry and developed foreign markets and business channels. Alpha has been the industrial chain operators.(3) The business of Alpha ranged from creation to the final distribution. "Entertainment" is in a preliminary scale. An international oriented, open and large entertainment platform, a new generation of Disney in China has begun to take shape. M&A not only optimizes the industrial resource configuration, but also can improve the competitive ability of the industry as a whole. In the growth process of China’s cultural media industry, it’s inexhaustible power is the more and more relax policies and the deeper degree of marketization. In this regard, The paper propose the following recommendations:(1) Market regulators should guide and manage the market. It also need to strengthen legislation to pure the capital market information and encourage healthy competition by policies.(2) Enterprises should look very carefully for the both in resources before the M&A and study the overall impact of M&A. They should find the least risky modes and ways and deepen the core competitiveness to ensure the advantages of core business.(3) Investors should strengthen their own professional quality and enhance investment skills to understand the market more, so that the intrinsic value of enterprises can be found.