A Study On M&A Performance Of China's GEM Listed Companies

Since the prelude to the merger and acquisition(M&A)of the Growth Enterprises Market(GEM)in 2010,GEM listed companies have initiated M&A,and the wave of M&A has intensified.Under this background,we cannot help raising questions about the motivations and the performance of M&A of listed companies on GEM.The exploration of the performance of M&A will be helpful to provide guidance for the going concern of the GEM listed companies.Based on the research results of domestic and foreign scholars,to begin with,this paper adopts the theory of M&A motives.After an overall inspection of the M&A behavior of the GEM,taking Huayi Brothers' merged with Yinhan Games as an example,this paper uses a variety of research methods such as event study,financial analysis and balanced score card to examine the performance of M&A.After research,this paper finds that from the perspective of development strategy,Huayi Brothers has improved the layout of the industry chain,acquired the synergy effect of “interaction between films and games”,broken the barriers to talents and technical barriers in the game industry and carried out multiple operations.From the perspective of shareholders' wealth,the stock price of Huayi Brothers has experienced abnormal fluctuations during the event window period.The cumulative excess return rate is positive and the shareholder wealth increases.From the four dimensions of balanced score card,this paper finds that after M&A,the financial performance of Huayi Brothers was good,the brand value was improved,the product structure and marketing promotion methods were more abundant and the talent pool was increased,but there was a case where the management efficiency decreased.Finally,in order to provide reference for GEM listed companies to achieve sustainable operations through M&A,this paper summarizes the successful experience from the M&A case of Huayi Brothers,and provides other M&Arelated recommendations for other GEM listed companies,such as: selecting the right M&A target,maintaining control over the target company,and attaching importance to resource integration,etc.