Motivation And Performance Research Of Qingsong’s Merger And Acquisition Of Northbell

China is in a period of strategic opportunities to comprehensively deepen reform.According to the strategic deployment of the 20 th National Congress of the Communist Party of China,a new round of enterprise reform is in full swing.At the same time,the world economic growth continues to slow down,the demand for investment,consumption and exports are weak,and the downward pressure on the chemical industry is great.With the intensification of global trade frictions,the production of chemical products is facing more external adverse factors.China is recognized as a large chemical industry country.In 21 years,the global output accounted for 36%,and the vast majority of chemical production capacity has ranked first in the world.In 2021,the investment in fixed assets of the chemical industry will be 1390.318 billion yuan,up 4% year on year and 2.4 percentage points lower than that in 2020.After years of rapid development in China’s chemical industry,the production capacity of most products has increased rapidly,and the product supply has changed from "overall quantity shortage" to "structural shortage".The main reasons for structural shortage of chemical products in China include: the supply of raw materials is subject to multiple constraints and backward production capacity still accounts for a large proportion etc.M&A has become a way for chemical enterprises to seek value added.Through M&A,they can play a synergistic role,expand the value chain and stimulate new economic growth points.Based on this,this paper takes the field of chemical industry as the starting point,and studies a typical case--the merger and acquisition of Northbell by Qingsong Group,hoping to provide a reference for companies’ M&A in the same industry.This study first summarizes the theories related to M&A motivations and performance,briefly introduces the situation of both parties and the M&A process.Secondly,a detailed analysis is conducted on the M&A motivations and performance of this case.The motivations for this merger and acquisition include external and internal factors.The external factors mainly include responding to policy calls and breaking the industry pattern.The internal factors include obtaining synergies,expanding market share,acquiring advanced technology,and the impact of performance commitments.This study discusses the market performance and financial performance of M&A.Market performance uses the event study method and the BHAR method to study short-term and long-term market performance respectively,and uses the financial indicator method and non-financial indicator method to analyze the overall performance of M&A.The performance results show that the short-term market performance is good,while the long-term market performance is not ideal.The overall financial performance is average,with improved inventory turnover and growth capabilities,while debt repayment and profitability show a downward trend.Northbell’s cosmetics business is operating well,while Qingsong’s traditional business segment,turpentine oil,is not operating well.Affected by the epidemic,the overall business performance in 2020 and 2021 was poor.Overall,there are areas of success in this acquisition,which meet the expectations of the acquisition and have had a positive impact.At the same time,there are also shortcomings.Finally,through the analysis of this merger and acquisition event,three major research conclusions are drawn:(1)There are four main motivations for Qingsong’s acquisition of Northbell;(2)Qingsong’s acquisition of Northbell has good short-term economic consequences;(3)The long-term economic consequences of Qingsong’s acquisition of Northbell are poor.In view of the shortcomings of M&A,the corresponding suggestions are also put forward,that is,it is suggested that Qingsong Company strengthen its risk awareness and focus on the integration of resources in advance,and it is suggested that the whole chemical industry should grasp the policy orientation and actively do a good job in the integration of M&A.The successful merger and acquisition has created value for Qingsong Group,and it is hoped that it can also provide reference for future merger and acquisition activities in the chemical industry.