Analysis Of The Failure Of CF's Acquisition Of XF

With the continuous strengthening of our country's ecological civilization construction,many high-polluting companies through M&A restructuring and upgrading.M&A of environmental protection industries by high-polluting industries accounted for about 30% of the total number of M&A in the industry in recent years,and it is still showing a trend of rising volatility.For high-polluting companies cross-industry M&A of environmental protection companies,domestic and foreign research mostly focuses on motivation and performance,and there are not many case studies on risks and failures.Therefore,this article takes non-ferrous metal mining and dressing companies of high-polluting industries and comprehensive utilization of waste resources of the environmental protection industry as the research object.The core question of the research is what are the reasons for the failure of non-ferrous metal mining and dressing companies in acquiring environmental protection companies?Whether the M&A is successful can not be defined in a short time.Therefore,this article tends to choose the M&A in which high-polluting companies implemented major asset reorganizations of environmental companies 3-5 years ago.CF's acquisition of XF was officially completed in 2015.CF belongs to the non-ferrous metal and dressing industry of the high-polluting industry,and XF belongs to the comprehensive utilization of waste resources of the environmental protection industry.The merger is a major asset reorganization,and the disclosure of information is more detailed.In addition,CF has divested XF in 2020.Through it's analysis,it can be able to see the whole process of M&A,so as to better analyze the factors that lead to the failure of M&A.Through the analysis of market reaction and long-term financial performance,it is found that the merger did not achieve the expected results,which is in line with the definition of a failed merger.Further explore the reasons of the failure of M&A,and draw the conclusion of this article: the factors leading to the failure of M&A include information asymmetry,difficulty in obtaining synergy,high valuation,high financial pressure after M&A,and incomplete risk control system.Based on the analysis of the case,it provides reference for other high-pollution and high-energy-consuming companies that are interested in acquiring companies of the environmental protection industry.The innovation and application value of this article are: through the analysis of the less-researched failure cases of high-pollution industries' M&A of environmental protection companies,case study is used to get the big picture from small details in enriching the related research on the failure of M&A and the research on the risk of M&A of Environmental protection companies.