Study On Financial Synergies Of Overseas M&A

In recent years,as China’s overall economic strength rising,more and more already has sizeable domestic companies to seek industrial transformation and upgrading,at the same time the domestic market after years of rapid economic development,many industry gradually become saturated domestic market demand,some industries and even real problems of excess production capacity,therefore,as the ""the Belt and Road" strategic policy and other related to "go global" policy launched,more and more Chinese enterprises for their own long-term development,in succession planning "go abroad",develops the overseas market.Domestic enterprises under the guidance of national policy as well as their own development needs,gradually in various industries for overseas M&A boom,in 2016 the number and amount of Chinese enterprises overseas mergers and acquisitions is reached its peak,lead the world.In the following year,due to the relative tightening of China’s policy and sino-us trade friction and other complex factors,such as the scale of Chinese enterprises overseas mergers and acquisitions and growth trend eased,but the annual overseas M&A scale is still at a higher level.For overseas mergers and acquisitions,mergers and acquisitions after realizing synergy is the results of evaluation of enterprise mergers and acquisitions as a key factor that nots allow to ignore,including financial synergy as one of an important part of enterprise M&A synergy,financial synergy results in measuring M&A plays a more crucial role,therefore,in the current complex international market environment,in the process of how Chinese enterprises in overseas mergers and acquisitions and mergers and acquisitions after the integration of security and improve financial synergies generated by a lot of plans to implement more and more overseas mergers and acquisitions,and is a wide attention of overseas M&A of Chinese enterprises.Paper first in combed the domestic and foreign financial synergies related on the basis of existing research literature on mergers and acquisitions,financial synergy and its form of expression defining the related concepts,and introduces the relevant theoretical basis of financial synergies,such as the signal transmission theory,market internalization theory,taxation theory,and the theory of free cash flow hypothesis,at the same time,based on the above theoretical basis to build the financial synergy effect evaluation system;Secondly,in the home appliance industry where large-scale overseas mergers and acquisitions happened frequently in 2016,this paper selects the largest overseas mergers and acquisitions in the industry as a specific case for analysis,this paper mainly adopts the financial index method and based on the above was used to construct the evaluation system in the case of financial synergy and its reasons were analyzed,mainly from the reducing effect of the cost of capital,capital utilization,improve the market expected effect,tax effect,effect of this a few aspects of mergers and discuss financial synergy effect,through analysis of the paper think that the main enterprise in the overseas merger and implements a better financial synergies,such as the implementation effect of reducing effect of the cost of capital and capital utilization and the expected effect,etc.,However,the overseas M&A did not achieve a very ideal financial synergetic effect,such as the increase of debt repayment risk while saving capital cost and the tax saving effect were not clearly reflected in the long term.Finally,on the basis of the analysis results of financial synergies in the above merger cases,this paper summarizes the experience and problems of this merger event and puts forward corresponding Suggestions,in order to provide some references for other listed companies in China to conduct overseas mergers and acquisitions.