Research On The Improvement Of The Value Evaluation Of Jinglan M&A Zhongke Environmental Enterprises

With the deepening of economic globalization,companies continue to accelerate the expansion of capital.At this time,corporate mergers and acquisitions are one of the important methods of capital expansion.Recently,thanks to the support of national policies,environmental industry has developed rapidly.Compared with the development of environmental industries in developed countries,our country has now entered the second stage of the three development stages—the standardized development stage.No matter what kind of development strategy the environmental company will make in the future,mergers and acquisitions will occur frequently in the environmental industry,so the importance of accurately assessing the value of environmental companies is self-evident.At present,it is a relatively common business type to evaluate the enterprise value for the purpose of merger and acquisition in asset valuation practice,and it is usually evaluated by the income method.Therefore,it is necessary to conduct in-depth research on the income method of M&A valuation in the environmental indus try to improve the valuation accuracy.This paper choose Zhongke Environmental Engineering Company as an example of the environmental engineering industry.After a detailed analysis of the current situation,prospects and characteristics of the environmental engineering industry,it analyzes the limitations of the income method in the M&A valuation of environmental companies,and identify the problems in the Zhongke Environmental Engineering Enterprise M&A valuation case:When determine the discount rate,only choose those have similar main businesses companies in the same industry as comparable companies are subjective;The option value contained in the merger is ignored,so the enterprise value is underestimated.This paper improves these two issues in sequence:Determine the selection criteria of comparable companies from a multi-dimensional perspective,and use the entropy method and Hamming proximity to choose the comparable companies to improve the discount rate;On the basis of the income method,the value evaluation of Zhongke environmental enterprise is combined with the idea of real options,taking the future development uncertainty and decision delay into account,this paper believes that the overall value of the target enterprise in M&A should be compos ed of two parts: its own intrinsic value and the option value in M&A which generated by uncertain factors.The sum of the two is the more objective and realistic evaluation result.On the basis of improvement after analysis,the new evaluation result is compared with the original result and the final transaction price of the case,and it is verified that the improvement is reasonable,so as to provide a certain reference for the value evaluation of environmental engineering enterprises in mergers and acquisitions.Finally,the paper objectively expounds the current situation and problems of using real option pricing method in the current stage of China,and puts forward some pertinent Suggestions.This paper hopes to make a certain case to optimize the M&A value evaluation of China’s fast-growing environmental enterprises,combining the most widely used income method and real option method in China,to provide a little reference and thinking for the practical work of assessors.