Motivation And Risk Analysis Of High Premium Mergers And Acquisitions In Film And Television Companies

Mergers and acquisitions have become a common way of capital operation in today’s capital market.Another example is to achieve transformation and upgrading.However,due to the agency problem,overconfidence of the management,performance compensation commitment and other motivations,the phenomenon of high premium mergers and acquisitions occurs again and again.Goodwill generated by premium mergers and acquisitions and goodwill impairment problems have been on the rise from 2014 to 2018.The goodwill accumulated by listed companies in 2018 totaled 1.307.6 billion yuan,three times the amount in 2014.What’s more,companies seem to have pricked the goodwill bubble for a while,with the total amount of goodwill withdrawn in 2018 up 61.44 times from 2014.Therefore,how to scientifically and reasonably carry out business merger and avoid the bubble of goodwill that will burst at a touch is not only a disease to be diagnosed by the CSRC,but also a problem related to the interests of enterprises in the capital market.In order to more accurately understand the current situation of China’s film and television cultural industries at a premium,put forward the effective measures can be used for reference of concrete,in this paper,a detailed analysis of merger,acquisition and reorganization,and high premium M&A motivation and risk,and combined with the characteristics of film and television industry,to the enterprise effectively avoid high premium M&A risk measures are put forward.This paper takes the case study as the research method and selects Beijing Jingxi Culture&Tourism Co.,Ltd(referred to as Beijing Culture)as the case study object.Firstly,it analyzes the industry characteristics of Chinese film and television culture and the prevalence of premium mergers and acquisitions in the industry.Secondly,the course of premium merger and acquisition of Beijing culture is sorted out.Firstly,the qualification of the target enterprise is analyzed from the perspective of equity structure and financial operation,and then the payment consideration method of Beijing culture and the evaluation result of the target enterprise are introduced.Then it analyzes the reasons for the M&A of Beijing culture and the reasons for the M&A of high premium,and then analyzes the risks of M&A of high premium based on the development status of Beijing culture this year.In particular,the third quarter report of Beijing culture shows a bright performance.This paper will identify the hidden corporate crisis under the financial report and see the signs of high premium merger risk through the appearance.It is helpful to help enterprises that also have high premium mergers and acquisitions to "demining" timely,predict and prevent the possible risks,and adopt more appropriate means of enterprise operation.Through the case study,this paper concludes that in order to identify and effectively avoid the risks brought by mergers and acquisitions of high premium in China’s film and television culture industry,the following Suggestions can be considered: first,to accurately evaluate reasonable pricing;second,to establish and improve the internal control system to strengthen the internal control of the merging company.It is beneficial to gather the wisdom of many people and improve the scientific nature of decision-making.Third,pay attention to the integration after merger and insist on implementation.After the merger,the establishment of a reasonable company system to ensure the rational integration of human resources culture will ease the disputes between shareholders and senior executives;Fourth,we should focus on improving our core competitiveness.Epitaxial merger and acquisition can help endogenous development for time advantage,but can not be completely replaced,so we must strive to develop their core competitiveness.