Research On The Transnational M&A Performance Of Bright Dairy Co.,LTD

With the continuous increase of China’s economic development level,the national economic policy is gradually changing.The state encourages Chinese enterprises to support the development strategy of "going global" and actively enlarge the links with other countries.On this basis,the number of cross-border M& A cases in China has increased rapidly.In the dairy industry,due to the impact of the melamine incident,our government especially encourages dairy enterprises to implement cross-border M&A to improve consumers’ trust in domestic dairy products.Although the dairy enterprises in our country also vigorously respond to the government’s call to actively carry out cross-border mergers and acquisitions,there are few cases that can achieve coordinated development and greatly improve the value of enterprises.This paper chooses Bright Dairy’s M& A cases of New Wright Dairy and Tnuva Group.These two M& A cases are the first successful cross-border M& A cases in China’s dairy industry and the largest M& A cases so far.Based on the analysis of the basic situation of Bright Dairy and the implementation of these two cross-border M& As,this paper studies the performance of two cross-border M& As of Bright Dairy from two perspectives of stock value and financial data by using event study method and EVA analysis method,and makes an in-depth comparative analysis of the performance of these two M&As.It is hoped that through the in-depth study of these two M& A performances,the factors affecting the performance of Bright Dairy’s cross-border M& A will be found,and some enlightenments will be put forward for improving the performance of China’s cross-border M&A of dairy industry.Research shows: From the stock value perspective,the cumulative abnormal yield of Bright Dairy after the acquisition of the new Wright Dairy Industry is positive and tends to be stable.The stock price increase indicates that the performance of the company’s stock value after the acquisition is significantly improved.After the acquisition of Tnuva Group,the stock accumulated abnormal return rate was negative and fluctuated.The stock price did not increase significantly,and the performance of M&A from the perspective of stock value did not improve.From the perspective of corporate financial data,EVA value of Bright Dairy Co.,Ltd.has steadily increased after the acquisition of New Wright Dairy Co.,Ltd.,the value of enterprises has been improved,and the performance of mergers and acquisitions has continuously improved.After the acquisition of Tnuva Group by Bright Dairy in 2015,although the EVA value has increased,the increase is still mainly due to the contribution of the acquisition of New Wright Dairy,and the performance improvement brought by the acquisition of Tnuva Group has not yet been fully demonstrated.This paper considers that the main factors affecting the performance of Bright Dairy’s cross-border M&A are: accurately evaluating the value ability of the target enterprise,selecting the financing mode of M&A funds,quality of M&A information disclosure,positioning of product strategy after M&A and the integration ability of enterprises.On the basis of the above research,this paper puts forward the following enlightenments on how to improve the performance of cross-border M&A of dairy enterprises in China: to determine the price of M&A rationally;to strengthen the management of M&A financing risks;to improve the information disclosure system of enterprises;to correctly adjust the product strategy of enterprises;and to formulate an integrated scheme suitable for the development of enterprises.