The Study On Operation Model Of "PE+Listed Companies" M&A Fund

According to the relevant data of private placement,592 domestic M&A fund transactions occurred in the first quarter of 2018,an increase of 5.9 percent compared with the first quarter of 2017.These transactions involved 266.553 billion yuan,which a increase of 4.3 percent compared with the same period in 2017,reflecting the vigorous development trend of China’s M&A fund market.Among them,708 listed companies participated in the establishment of industrial M&A funds in 2016-2017,shows that the participation of Listed Companies in the establishment of industrial M&A funds has become a trend.The development of M&A funds in China has experienced from 1.0 mode to the type of“PE+listed company”.It reflects that“PE+listed companies"M&A funds are not only recognized by the capital market but also by the majority of investors.The adoption of this M&A fund model can not only broaden their financing channels,reduce the risks in M&A,but also help to reduce the risks in the process of withdrawal of PE institutions.But opportunities and risks coexist,there is no doubt that many risks in this M&A model,such as insider trading,performance commitment,inadequate post-investment management ability and so on.This paper is divided into five parts to elaborate the specific operation of WPE+listed company"M&A fund in the form of specific cases.Firstly,the main viewpoints of scholars at home and abroad are explained,and the characteristics of traditional and innovative M&A funds are comprehensively compared and analyzed from the basic general situation of M&A funds;secondly,through the collation of the latest data,the number of M&A funds of Listed Companies in China and the information related to industries are analyzed,with emphasis on the development of M&A funds of biomedical industry in China.Through the analysis of the data,this paper explores the advantages and disadvantages of the development of M&A funds in China.Then,the main participants in the case of Jinsheng Fund are deeply discussed about the motivation of the establishment of the fund.The advantages of Jinsheng Fund are found after a comprehensive analysis of the specific operation of Jinsheng Fund is made.It is found that Jinsheng Fund has the risk of insider trading,improper performance commitment and inadequate post-investment management ability in the operation process.Finally,in view of the existing problems in the M&A,the corresponding solutions are put forward,such as:focusing on the layout of emerging industries,improving the corresponding legal system,strengthening the integrity of information disclosure,and looking at the betting agreement rationally,which can provide some reference for the establishment of M&A in China’s medical industry.The main conclusion of this paper is that“PE+listed company”M&A fund not only take the advantages of PE institution specialization,but also take the industrial advantages of listed companies.Listed companies can realize the optimization and upgrading of industrial structure through M&A fund acquisition.In the short run,listed companies can realize the short-term rise of stock price and the short-term change of turnover through M&A projects.The market value of listed companies will increase and form a hot spot of short-term investment.In the long run,“PE+listed companies”M&A funds improve the long-term profitability and operating ability of listed companies,bring about financial synergy effect and increase the company’s value.Therefore,reduce the risks of mergers and acquisitions of listed companies.From the design of Jinsheng Fund itself,Jinsheng Fund raised 2 million yuan to 1.6 billion yuan from the beginning of its establishment.PE institutions continue to evade risks through the introduction of institutional investors,and finally withdraw,avoiding the supervision and inspection of the Securities Regulatory Commission reasonably.From the design period,Jinsheng Fund has a longer establishment period.In this process,the acquisition was well completed by continuously stripping the non-performing asset of Longyi Pharmaceutical and adjusting the purchase price.From the financial situation of listed companies after Jincheng Pharmaceutical Merger and Acquisition of Longyi Pharmaceutical Co.,Ltd.,M&A has brought synergistic effect of management and strategy for listed companies,as well as good performance in capital market and other aspects.