Research On The Valuation Of Mergers And Acquisitions In The Pharmaceutical Circulation Industry

Throughout the development of M & A in the world,it has gone through seven waves,and the M&A activities have gradually matured.The seventh wave of cross-border M&A in the world has opened the era of M&A in China.Reviewing the data of M&A transactions in recent years,we can see that the number and amount of M&A cases in China are always high.In recent years,the medical industry has been affected by the policy of medical reform,and M&A has become the general trend of the industry development.Along with the increase of the number and amount of participation in M&A business,people began to question the rationality of the M&A price.Whether the income brought by M&A is consistent with the evaluation expectation at that time,and whether the strategic significance of M&A has been realized.The pursuit of the maximization of enterprise value has become the direction of managers' efforts.Many facts and data also prove that the results of M&A cases are often unsatisfactory.According to the relevant survey,in recent years,more than half of M&A cases are failed.One of the most important reasons for the failure of M&A is the deviation of value evaluation methods or unreasonable variables.Effective value management can be the benchmark of enterprise management actions,help enterprises adjust their current business strategies,and improve their management methods.China's medical reform policy has experienced nearly 10 years of baptism,and has found suitable reform path,and the implementation of the strength is also getting constantly strengthened.It took a relatively long time from the proposal of "Two Receipts" to the strict pilot program,but the pilot program to the deep implementation took less than two years.However,the influence and progress of "4 + 7 Quantity Purchase" are greater and faster.With the continuous development of national economy,the demand of pharmaceutical industry is increasing.Under the dual effect of the industry development trend and the relevant pressure of policy promotion,pharmaceutical circulation enterprises tacitly form a set of response ways.Large enterprises in the industry continue to merge small enterprises for joint development.It can be seen that in recent years,the number of M&A in the industry has remained high,and the price has constantly reached a new height.The whole pharmaceutical industry has entered into the vortex of M&A wave.The case cited in this paper-the acquisition of Cardinal Health China by Shanghai Pharma is a representative case in recent years.It is an acquisition among the top ten enterprises in the same industry,involving a total amount of 557 million US dollars,which has attracted wide attention in the industry.At the same time of seeking the target of M&A and seizing the market,M&A in the industry faces many problems.The higher purchase price leads to the huge goodwill of M&A enterprises,and whether these goodwill will be impaired in the future operation,this requires that enterprises can choose the appropriate evaluation method when making the value evaluation of the M&A target,and make a reasonable evaluation.In this way,we can really find a suitable target for M&A and make contribution to the maximization of enterprise value in the long run.So how to choose the right evaluation method and make the right value evaluation is the main purpose of this paper.This paper is divided into five chapters.The first chapter is the introduction part,which mainly puts forward the research background,purpose and significance,the main research content and methods.The second chapter mainly studies the related literature review,as well as the related theories of the concepts and methods of M&A and enterprise value evaluation.The third chapter introduces the current situation and characteristics of China's pharmaceutical circulation industry,and evaluates the applicable enterprise value evaluation methods.The fourth chapter,taking the acquisition of Cardinal Health China by Shanghai Pharma as an example,analyzes and evaluates the methods of value evaluation of the target enterprise.The fifth chapter is the conclusion and deficiency.This paper mainly takes the case of Shanghai Pharmaceutical M&A of Cardinal Health China as an assistant,measures the value evaluation method suitable for pharmaceutical circulation enterprises by qualitative method,and makes quantitative evidence by case,so as to provide reference for relevant enterprises to make the right method choice in future M&A,avoid paying the high price,and form huge goodwill.