Research On The Performance Of Cross-border M & A In China’s Domestic Appliance Industry

Domestic appliance industry is a post cycle industry of real estate,domestic appliance industry is limited by many factors such as real estate regulation,demand approaching saturation and low access threshold.Therefore,enterprise transformation and business upgrading are the common challenges faced by all domestic appliance enterprises.Under the joint action of domestic appliance enterprises seeking transformation and upgrading through M & A as well as overseas industrial reform providing a large number of acquisition targets,the wave of cross-border M & A in the domestic appliance industry began in 2010,peaked in2016,and finally stopped gradually in 2018,entering the stage of post M & A integration.Nowadays,the integration effect after M & A has been gradually revealed.Some domestic appliance enterprises have successfully achieved their strategic objectives and promoted the development of the company through overseas M & A;However,some domestic appliance enterprises have deteriorated their business conditions and unsatisfactory financial performance.Midea group is an important case of the success of cross-border M & a strategy.after the M & A,its business model is diversified and its development momentum is good.Why did Midea Group carry out many cross-border mergers and acquisitions? What integration measures has Midea Group taken? What impact does cross-border M & A bring to Midea Group? What enlightenment can Midea Group’s M & A experience bring? These questions are worth exploring.Taking Midea Group as the research object,this paper analyzes the performance of Midea Group in different stages before,during and after M & A from 2014 to 2020,studies the emotional performance of investors on M & A by using event research method,and analyzes the change trend of enterprise credit quality before and after M & A by using KMV model,The financial analysis method is used to analyze the improvement or deterioration of various financial indicators before and after M & A,and the non-financial analysis method is used to study the development of Midea Group’s business upgrading,research and development strengthening and so on.This paper analyzes the effects and overall performance achieved by Midea Group through overseas mergers and acquisitions of Toshiba,KUKA,Clivet and Servotronix from 2016 to 2017.Midea Group’s four cross-border mergers and acquisitions in 2016-2017 are an important part of Midea Group’s overall development strategy.Midea Group promoted the intelligent transformation of the original domestic appliance business through the acquisition of Toshiba,successfully opened up a new track for industrial robots through the acquisition of KUKA and Servotronix,and improved the business puzzle of HVAC and intelligent buildings through the acquisition of Clivet.Although many mergers and acquisitions have brought many problems,such as high goodwill impairment risk,high long-term liabilities whitch pressurized the debt repayment pressure of the enterprise,poor performance of the acquisition target itself whitch deteriorated the company’s financial performance,Midea Group has optimized the company’s credit quality and realized diversified business layout and intelligent development through cross-border mergers and acquisitions,The strategic goal of enterprise transformation has been completed,and market investors are also optimistic about its M & A performance,which has important reference value for the overseas M &A strategy and post M & A collaborative integration of other household appliance enterprises.domestic appliance enterprises should pay attention to realizing diversified business and digital transformation through overseas M& A,and pay attention to the integration strategy after M & A to improve the performance of M & A.