The Research On The Motivation And Performance Of Cross-level Capital Market M&A In China

With the adjustment and upgrading of China's industrial structure and the support of policies,the M&A market in China has experienced explosive growth in recent years.The scale and quantity of M&A transactions have been hitting record highs.China's multi-level capital market includes A-share market,OTC market and equity trading market.Cross-multi-level capital market M&A also involve the cases of listed companies to acquire OTC,OTC reverse merger listed company,listed companies' M&A of regional equity systems and etc.Based on the limitations of the length of the article and the case study,as well as the non-public nature of the regional equity system,this paper only studies and analyzes the examples of listed companies to acquire OTC.This paper hopes to study the Chinese operation of multi-level capital market M&A.Use research on it's motivation,performance and risk to evaluate the M&A and find how it affects the future development of Chinese enterprises.Through analysis,it can be found that due to the characteristics of the OTC enterprises,this model of multi-level capital market M&A presents its unique features.In recent years,the good growth of OTC and its unique characteristics have also led to strong M&A motives for listed companies.Subsequently,this paper uses ROE,EVA and other indicators to statistically analyze the performance increase and decrease of different M&A models before and after M&A.It can be seen from the data change trend that compared with ordinary M&A,the enterprises that acquired the OTC are more likely to achieve growth in ROE and EVA.And from the comparison of performance before and after the merger of the case company,this M&A model allows the company to get high value improvement with the help of OTC's growth and stronger industrial upgrading ability.However,due to the late rise of multi-level capital market M&A,the lack of data and the limitations of case analysis,the research conclusions may not be universal.The performance of M&A relating to the OTC needs to be tested by empirical methods.Finally,based on the overall research and case analysis,this paper finds the risk points that hinder the cross-multi-level capital market M&A to achieve positive performance,and proposes targeted recommendations for cross-multi-level capital market M&A.In this way,we will enrich relevant theoretical research,and hope to guide China's listed companies to achieve better development across the capital level.This paper is divided into seven chapters.The first chapter is the introduction,which introduces the research background and significance,expounds the research ideas and research methods,and gives the reader a certain initial understanding of the full text.The second chapter is literature review.At the same time,it analyzes the existing research results related to multi-level capital market M&A and traditional M&A from the perspectives of M&A motivation and M&A performance.The third chapter defines the related concepts.It defines the concept across the multi-level capital market,and describes the undervalued theory and synergy theory,paving the way for the following research.The fourth chapter is a description of the overall environment of M&A across multiple levels of capital markets,comparing the environmental differences between the A-share market and the OTC,summarizing the characteristics and motivations of M&A across multiple levels of capital markets.Finally,through the comparative study of EVA and ROE indicators in multi-level capital market M&A and common M&A,the superiority of M&A across multi-level capital markets in achieving M&A performance is obtained.The fifth chapter refer to the background.This paragraph selects the case of the listed company Nanyang Co.,Ltd.to acquire Tianrongxin(OTC),and explains in detail the various aspects of the case in the process of M&A.On this basis,it leads to the M&A motivation in the case.The sixth chapter analyzes the economic performance of Nanyang Co.,Ltd.after acquiring Tianrongxin.Through short-term and long-term analysis of M&A performance by event research method and long-term financial indicators,the long-term performance and growth performance of Nanyang Co.,Ltd.will be demonstrated.Then it Providing some positive evidences and follow-up recommendations to instruct M&A across Multi-level capital market.The seventh chapter is the conclusion,suggestion and prospect.While summarizing the positive performance,it analyzes the potential risks of M&A across multi-level capital markets,proposes the improvement of M&A across multi-level capital markets,and finally puts forward the shortcomings of this paper and the direction that can be studied later.There are three innovations of this paper.Firstly,although there have been many researches on the motivations and performance of M&A in the past,it is mainly concentrated in listed companies.Few scholars have studied the motivation and performance of listed companies in acquiring OTC companies.This paper compares the institutional environment of M&A in the A-share market and the OTC market,analyzes the characteristics of the kind of M&A,and compares the performance differences between the acquisition of the OTC and the acquisition of the ordinary,which lays the foundation for further research.Secondly,this paper takes Nanyang Co.,Ltd.acquiring Tianrongxin as an example to conduct research,which will help enrich relevant information in this field.Finally,this paper finds and summarizes the coordination management issues in the process of listed companies acquiring OTC,provides relevant suggestions for the regulatory agencies,which provides reference for listed companies' M&A,and provides successful experience in multi-level capital market M&A.At the same time,it is also conducive to promoting multi-level prosperity and development of the capital market.This paper also has some deficiencies.Firstly,this paper selects the case of M&A between listed companies and OTC companies in China.Considering the data disclosure and research space,so exclude overseas M&A,reverse M&A and private equity M&A.Moreover because this paper only take Nanyang Co.,Ltd.as a case,there exist certain limitations in the research.Secondly,this paper adds the event research method in the case analysis process,but there are many factors affecting the stock price.Therefore,external factors cannot be excluded to produce a certain degree of influence on the analysis results.Finally,because the overall status,characteristics and performance research data of the listed companies' acquisition of the OTC are collected manually,due to the time of the OTC M&A and the scope of author's academic ability,it is not excluded that the conclusions of the paper have confines and errors.