Analysis On The Motivation And Performance Of Share Swap Absorption Merger Between Wen's Group And Dahuanong

With the acceleration of economic globalization,the economic relations among all the countries in the world are getting closer,and the competition in the international market has intensified.Only by constantly expanding capital to enhance its own strength can the enterprise seek long-term development in the fierce competition.In recent years,enterprise merger has gradually become an effective way for capital expansion.Powerful combination has become the mainstream of capital market development.Since the 19 th century,there has gone through six large-scale tides of M&A worldwide,the scale of M&A has been gradually expanded,the number and amount of M&A have increased rapidly.Relevant research shows that the ways of M&A are gradually upgraded,and the cases of internal resources integration are also increased.Since the non-tradable shares reform,our country's capital market is maturing day by day.M&A has experienced the exploration process from nothing to existence and from scratch to maturity.With the expansion of the transaction size,it is difficult to meet the demand of M&A funds only by cash payment.The share swap absorption merger is becoming an important way for M&A because it is not required to pay large sums of money,and it is easily accepted by shareholders of both sides.In the process of optimizing the allocation of resources and improving the efficiency of operation,M&A also brings a series of integration risks to enterprises,such as information asymmetry risk and human resources integration risk.Enterprises under the same control have similar corporate culture,which can effectively reduce the degree of information asymmetry,reduce the difficulty of resource integration after M&A,and maximize the overall benefits.Based on domestic and international studies,this paper uses the combination of theoretical analysis and case analysis,and analyzes the typical case of Wen's Group and Dahuanong.Firstly,this paper introduces the concept,classification and characteristics of stock swap absorption merger theoretically,and uses the theory of the synergy theory,the market power and the transaction cost theory analysis to analyze the basic motivation of M&A from the perspective of controlling shareholder.It mainly includes the improvement of the company's industrial chain,the reduction of connected transaction and the solution of horizontal competition problem.In case analysis section,this paper adopts the methods of charts and financial indicators,and briefly introduces the basic situation of two sides that take part in this share swap absorption merger.From the perspective of operating environment and merger method,it discusses the reasons for the merger between subsidiaries under the same control and the reasons for adopting the convertible method.Then it observes the effects combined with the data over five years before and after the merger,and analyzes the reasons about influence on performance of share swap absorption merger from three aspects.By studying typical cases,summarizing the relevant conclusions and enlightenments,this paper makes clear the reason why the controlling shareholder let subsidiaries under the same control adopt a share swap for absorption consolidation.At the same time,the share swap absorption merger will not cause a large amount of cash flow,which can relieve the company's financial pressure,reduce the financial risk of the merger,and protect the interests of the small and medium-sized shareholders of both sides.Facts have proven that the merger was successful,with improved operating performance and improved profitability.On the basis,we get the following enlightenment: the company should make rational use of preferential policies to formulate development direction;Choose the right target company and scientific merger plan when adopting the stock-for-stock method;Focus on the integration of resources and enterprise culture after the merger.