A Case Analysis On Equity Carve-outs Of Fantasia And Colourlife

In the 1960 s,mergers and acquisitions became the preferred method for corporate diversification.The scale expansion through mergers and acquisitions brought rich economic benefits to enterprises,but at the same time,the degree of diversification was too fast and the scope of business expanded too quickly.As a result,enterprises have gradually begun to reduce management efficiency and increase operating burdens.In order to solve the problems left by excessive diversification,in the 1980 s,many American companies began to consider the separation of their business operations to implement a more specialized operation.At the same time,the assets separated can be carried out in the capital market,so as to achieve the positive effect.Compared with foreign countries,spin-off listing appeared later in China.With the successful launch of the GEM in 2009 and the six prerequisites of the spin-off listing subsequently issued by the China Securities Regulatory Commission,the spin-off listing officially prevailed in the capital market in a standardized manner.And then,the spin-off and listing has gradually become the preferred way for listed companies to pursue “refocusing” and maximize their profits.With the decline of the macro environment,the traditional model has been unable to meet the needs of the vast majority of real estate companies taking into account the size and profit of enterprises.Under this background,real estate companies have begun to split the property sector to go public and try to get out of this area and take a cup in the blue ocean.However,due to the particularity of the real estate industry and the high degree of correlation between real estate and property,the CSRC has always been cautious about its spin-off and listing.In this article,we take the pattern of splitting the lottery life as the first in the market,by exploring the reasons for its spin-off and listing,evaluating the changes in performance before and after the spin-off,and analyzing the reasons for the performance changes,hoping to help real estate companies measure their own Suitable for spin-off listing.This article adopts a combination of multiple research methods.In the topic selection stage,the literature research method was adopted in the topic selection stage,This article summarizes the literature of scholars at home and abroad on spin-offs and listings.At the case analysis stage,a case study method is used to analyze the spin-off.The motivations and processes are analyzed,and the combination of financial,non-financial and capital market changes is used to evaluate the changes in the performance of the spin-off listing,and the causes of the performance changes are analyzed in depth.The comparative analysis method is used to compare and analyze the data of the pattern year and color life before and after the spin-off,so as to obtain the impact of the spin-off and listing on the operating status of the parent and subsidiary companies.The framework of this article is divided into six parts.The first part is an introduction,which mainly elaborates the research background and significance,the literature review on the spin-off and listing,the research ideas and methods of this article,and the framework structure of this article.The second part is the theoretical overview of spin-off listing,which specifically includes the concept,method,motivation,performance analysis methods and theoretical basis of spin-off listing.The third part is the case introduction of this article.First of all,it briefly describes the situation of Fantasia and Colourlife.Then it sorts out the development of the property management industry.Finally,it introduces the whole process of Fantasia’s separation and listing of Colourlife.The fourth part is the analysis of the motivations and methods of this article.This part is based on the third part,and further analyzes the reasons for the spin-offs and the methods of spin-offs.The fifth part is the analysis of the cause of the performance change of the case,which is the focus of the entire article.First,the financial performance before and after the spin-off is evaluated from the solvency,profitability,operating ability,growth ability and economic value added,and secondly The changes in non-financial performance before and after the spin-off were evaluated through social recognition,market share,innovation ability,and employee compensation indicators.The event research method was used to analyze the response of the capital market before and after the spin-off.Finally,the in-depth analysis of the reasons for these changes.The sixth part is the conclusion and enlightenment of this article.Through an in-depth analysis of this case,it is concluded that the parent and subsidiary companies have improved the situation of limited funds,enhanced market value,guaranteed core business development,and enhanced core competitiveness.Finally,based on the previous analysis,based on the success of this case,it will provide other companies that want to improve their operating conditions through spin-offs and listings.First of all,spin-offs and listings should fully consider the strategic needs of the parent and subsidiary companies,and evaluate whether they are genuine after listing.It can make subsidiaries become independent and make the parent company develop core business better.Secondly,the target of separation should be selected carefully.The more recognized by the market,the better.It is better to introduce some concepts and models that are not available in the existing market.Finally,after re-implementation,we should gradually reduce our dependence on the parent company and develop our core business,thereby ensuring the stable development of the enterprise.