Research On Performance Appraisal Of Cross-border M&aacquisition Of General Household Appliances By Haier Smart Home

With economic integration,more Chinese companies choose to enter the international market through cross-border M&A for long-term development consideration.Particularly,under the background that the domestic home appliance market tends to be saturated at present,many home appliance companies have joined the ranks of cross-border M&A.Through cross-border M&A,companies can rapidly enter the objective market,avoid technical barriers and make up for the deficiency of experience.It is an important strategic means to expand scale,increase market share,obtain effective resources,introduce leading technologies and improve competitive advantages.Haier Group and General Electric Co.,Ltd.are both leaders in the global home appliance industry,and their merger is undoubtedly a strong combination of the two countries’ electricity giants.It is a classic case in the history of cross-border M&A in the home appliance industry that Haier Smart Home,which is controlled by Haier Group,acquired the home appliance business of General Electric.Besides,Haier Smart Home has completed many cross-border M&A before,and has rich experience in the selection of target party and the timing of mergers and acquisitions.Therefore,its M&A performance is worth studying.Therefore,this paper takes the case of Haier Smart Home’s merger and acquisition of general household appliances as the research object.On the basis of referring to relevant materials and literatures,firstly,the introductory paragraph part simply extracts the content of the paper.Secondly,it recommends the relevant concepts and theories of cross-border M&A.Thirdly,it researchs and analyzes the cross-border M&A case of Haier Smart Home,and comprehensively uses three performance evaluation methods,namely event study method,financial indicator method and non-financial indicator method,to evaluate the performance after the M&A.Finally,conclusions are drawn and suggestions are put forward by summarizing the performance.The research of this thesis shows that: first,in terms of short-period performance,the market is optimistic about the cross-border M&A and responds positively to the event.The short-period performance of the M&A is generally good and the shareholder wealth is increased.Secondly,in terms of financial performance,due to the influence of large-amount financing and one-time all-cash payment method,Haier Smart Home debt paying ability was weak within two years after the merger and acquisition,and it was faced with great financial risks.Mild decline in operating capacity and the need to increase the level of M&A through continuous consolidation;Profitability is basically stable;Development capacity has been significantly improved.Thirdly,as for non-financial performance,the global market share,R&D investment,brand value and sales channels of Haier Smart Home have all improved,and the overall non-financial performance of M&A is good.Finally,this thesis summarizes the performance of the cross-border M&A,which not only provides reference for China’s home appliance enterprises in cross-border M&A,but also offer proporsals for the development of China’s home appliance trade.