Research On The Enhancement Of Company Value Through Horizontal Mergers And Acquisitions Based On Synergies

In recent years,many large and medium-sized companies choose to achieve expansion through mergers and acquisitions,and horizontal mergers and acquisitions are frequent.In his book Mergers and Acquisitions Create Value,Saad Sudassner points out that "mergers and acquisitions in related fields are more likely to improve company performance and free cash flow,thus increasing company value." This paper to test the theory to force source information merges palmer’s group as an example,the use of discounted cash flow technique based on normal,optimistic and pessimistic respectively cases,evaluated the force source information acquisition(at the end of 2016)before and after the merger integration(at the end of 2018),the value of the valuation results show that the force source information value of the company an average annual compound growth rate of 29.43%.This kind of company value enhancement originates from the horizontal merger and acquisition which improves the company’s industrial chain and reduces the competition in the same industry.Increase operating revenue and stabilize gross margin;It has expanded the ability to control customers,improved the turnover ratio of accounts receivable,etc.,and the synergies generated by the above horizontal mergers and acquisitions have increased the company’s free cash flow and ultimately enhanced the company’s value.Valuation results show that after the merger occurs,the value of the force source of information is rising,as further evidence of horizontal m&a synergy effect is the main reason for the company’s value enhancement,this paper also takes into account the other factors that may affect the value of the company ascend,eliminated as normal development trend,inflation and other company’s value enhancement,ultimately proves that the lateral force source information acquisition of palmer’s group synergy brought force source information value of the company’s ascension is about 21.93% annually,further merges the synergistic effect of argument is the main reason for the company’s value enhancement.The study on the synergy effect of horizontal MERGER and acquisition on the value enhancement of the acquier can provide necessary information for the company to assist the operation decision,and can also provide reference for other companies to make merger and acquisition and integration decision after merger and acquisition,which has important theoretical and practical significance.