The Case Study Of The Mergers And Acquisitions Between Baosteel And Wuhan Iron & Steel (Group) Corporation

The steel industry is an important part of our national economy and the lifeblood of our manufacturing industry.The significance of the iron and steel industry as the vanguard of supply-side reform is not limited to the industry itself,but also relates to the direction and confidence of the entire manufacturing supply-side reform.In the context of severe overcapacity of steel production in China,low industrial concentration,and fierce disorderly competition,mergers and acquisitions have become an important way for iron and steel companies to optimize resource allocation,achieve high-level professional development,and enhance overall competitiveness.First of all,this article starts with the theory and briefly introduces the types of mergers and acquisitions,the methods and effects of mergers and acquisitions,and then analyzes the background of mergers and acquisitions of Baosteel and Wuhan Iron & Steel(Group)corporation.Then from the perspective of mergers and acquisitions,the merger process of Baosteel and Wuhan Iron & Steel(Group)corporation is introduced.The date of purchase,merger of specific programs,etc.Secondly,this paper evaluates the effect of M&A of Baosteel and Wuhan Iron & Steel(Group)corporation from the aspects of “de-capacity”,“de-leverage” and “cost reduction”.In addition to evaluating the indicators reflecting supply-side reforms,the effect of M&A of Baosteel and Wuhan Iron & Steel(Group)corporation is also profitable.The analysis of the ability,debt repayment ability and operating capacity shows that after the merger of Baosteel and Wuhan Iron & Steel(Group)corporation,it has achieved immediate results in terms of profitability and operating capability,but the solvency has not yet been greatly improved.Finally,this paper proposes the merger and reorganization of China's steel industry and points out that it can promote the merger and reorganization of the steel industry from the perspective of the company and the government,so that the merger and reorganization of the steel industry will achieve better results.