Study On The M&A Performance Under The Background Of Structural Reform On The Supply Side

With the continuous advancement of the domestic reform process,the structural problems in economic development are becoming more and more obvious.In the past,economic growth mainly depended on demand-side investment,consumption and import and export,but now from the supply-side perspective,the biggest problem existing in the economic structure is overcapacity.In November 2015,the central government proposed the "supply-side reform",hoping to alleviate the situation of overcapacity.As a pilot project,the steel industry urgently needs to change its current situation.In 2015,the iron and steel industry entered the period of "severe winter" with the overall loss from marginal profit operation.Facing the problems of low resource utilization rate and too high asset-liability ratio in the steel industry,the important solution of supply-side reform is to carry out mergers and reorganizations for steel enterprises.Mergers and acquisitions can effectively improve industrial concentration,eliminate backward production capacity and realize scale effect.First of all,the theoretical part mainly explains the connotation of supply-side reform and related theories,as well as the related basic concepts of M&A and the theoretical basis of M&A performance,and analyzes the role of supply-side reform in promoting M&A of steel enterprises.At the same time,the present situation of case company Baosteel and WISCO is introduced,and the motivation of M&A of WISCO is further explored based on the angle of supply-side reform,which includes two parts: internal and external motive.The former includes enhancing the efficiency of business operation,improving financial ability and improving management efficiency,while the latter is to solve the problem of overcapacity,improve industrial concentration,and national policy guidance.Secondly,this paper fully considers the relevant background of supply-side reform and analyzes the m&a performance of baosteel wuhan iron and steel company.On the detailed analysis,the first event analysis method is used to analyze the short-term market performance,mainly by calculating the cumulative excess yields to test evaluation,then the financial index analysis method to analyze more long-term financial performance,including profitability,solvency,operation and development of four aspects,such as analysis of indicators,and through the analysis of the supplement relevant index and exponential smoothing forecast verification m&a synergistic effect,through the analysis of the supply side reform task highlight the supply side effect of m&a.Finally,this paper summarizes the experience of baosteel in the acquisition of wuhan iron and steel,and provides some enlightenment for the acquisition and reorganization of other steel enterprises.At the same time,in order to better promote the supply-side reform and narrow the gap with the industry average,relevant Suggestions are put forward,hoping to further improve the performance of enterprise mergers and acquisitions.