Sunac China Fails To Acquire LetV

In the course of continuous improvement of the Chinese capital market,mergers and acquisitions have gradually become the first choice for companies to expand their scale.Even more robust corporate mergers and acquisitions policies and different industrial reorganizations can lead to diversified development,diversification of business risks,innovative profit models,and consumer satisfaction.Preferences,etc.When the acquiring company is superior to the target company in terms of management capabilities,sending the management to the target company can not only help it improve its governance structure,deploy quality assets to effectively play its asset benefits,but also improve the efficiency of the management team.Reduce labor costs,but at the same time,there is another situation where the acquisition of financially distressed target companies requires a great deal of risk.On the one hand,target companies that are in financial distress generally face the dilemma of capital chain fracture.If the company does not improve its financial status and business strategy in the short term,it will face the risk of failing to repay its debt,lowering its credit rating,or even delisting.At this time,if the acquiring company cannot Turning the situation quickly and effectively will face great investment losses and high time costs.On the other hand,companies facing financial difficulties will generally not only face the problem of capital chain breaks but may also face deeper core competitiveness.Or the business model does not meet the market development trend.If the acquirer does not know enough about the target company and blindly conducts acquisition activities,it will pay higher information costs and direct costs.This article selects Sunac's acquisition of Le TV.com's equity case for a case analysis.Analyzes Xunrong's acquisition of the rights to Le TV,Le TVX,and Le TV.com in the hands of Mr.Jia Yueting,and finally faces the failure.Sunac China is a company that specializes in the comprehensive development of residential and commercial real estate.Letv is a company that integrates film and television platforms,terminals,and application industries.As a result of the rapid expansion,the capital chain breaks down into a financial dilemma.The acquisition of Le TV's high-quality assets and businesses has resulted in the diversified development and helped Le TV gradually improve its financial status.Therefore,this article selected Sunac's acquisition of Le TV as an example to analyze the motives and impacts of the acquirer's acquisition of financially distressed target companies and explained the acquisition of Le TV.com by Sunac.The details of the process,and then analyze the reasons for the failure of the acquisition of Le TV.Finally,it summarizes the motivations of the acquisition of the target companies in financial distress,providing some reference for other related companies to carry out acquisition activities.