The Influence Of Surplus Quality After Enterprise Merger And Acquisition

Merger and acquisition is a possible method for corporations to achieve profitability while decreasing the risk of delisting.In 2010,the M&A of China Eastern Airlines and Shanghai Airlines was a great example in the China aviation industry.However,whether such M&A could meet the expected goal in a relatively long term should be evaluated more comprehensively.The merger and acquisition of China Eastern Airlines and Shanghai Airlines is introduced in this paper.Base on the analysis of aviation industry,a quality evaluation system is built for the comparison.Combine with the financial data,and after the M&A,the surplus quality of China Eastern Airlines is evaluated comprehensively,which could measure the long-term effect of the M&A.In the meantime,compare with China Southern Airlines,assess the differentiation of the surplus quality.The conclusion of this paper is:at the adjustment period of the M&A,the profitability and asset-liability ratio index are improved.However,from a long-term perspective,the profitability of China Eastern Airlines is not sustainable;in other words,the surplus quality after the M&A remains underdeveloped,which means the only M&A itself can sightly improve the surplus quality of a company.Enhancing the surplus quality of a company after M&A need the company has a good governance and sustainable source of profit.At the end of the article,from the perspective of the company,regulators and investors,respectively,correspondingly.