Study On The Performance Of The Merger Between Yango And WZ GROUP

M&A is an important means for company to expand their markets,integrate resources and upgrade their industries.It is also an important strategy for company to corporate capital operation and expand new businesses.Therefore,the performance of M&A will directly affect the long-term development of the company.At the same time,the real estate industry,which is one of the pillar industries in China,plays a pivotal role in national economy.In 2017,the proportion of real estate in GDP increased by 0.46% from 2016 to 6.51%.However,in recent years,due to the increasingly fierce competition in the real estate industry,many real estate companies have chosen mergers and acquisitions to acquire resources,seize the market,and maintain the survival of companies.This paper firstly illustrates the background,research significance,research methods,structure of the thesis,and review the domestic and foreign literatures.Secondly,it analyses the M&A background,process of this M&A case and the purpose and motivation of the case.Then,the paper uses the Event Research Method and Factor Analysis Method to analyses the short-term performance and long-term performance of the case:(1)Although,during the period,the rate of AR sometimes was positive while sometimes was negative,the rate of CAR was always significantly negative,indicating that the merger bring negative effects to the Yango's short-term performance.And the negative effect caused the stock price and the yield to fall.(2)The long-term comprehensive factor's score and the six principal component factors' score has increased in the T+3 period than the T-1 period.The case has had a significant positive effect on the long-term performance of the Yango.However,in the T+1 period,the solvency factor,the operational capability factor and the growth operating factor all have declined,indicating that mergers and acquisitions have a negative impact on debt repayment and operational capability in the short term.This also echoes the conclusions of the short-term performance analysis conclusion.Overall,this acquisition has had a positive effect on the long-term performance of the Yango and good for its long-term development.The case teach us: Before launching mergers and acquisitions,we must clearly define the market positioning and purpose,do a good long-term strategic planning;Analyzing the market situation,grasp the time of mergers and acquisitions;Diversify payment methods,minimize the proportion of cash payments,and prevent financial risks.Pay attention to post-employment staffing,salary performance reform,cultural integration and resource integration;Introduce professional consulting services,and improve the efficiency of mergers and acquisitions.