Motivation And Economic Consequences Of Continuous Mergers And Acquisitions In Donghua Software’s

Due to the rapid development of social economy and the impact of the international economic crisis on the domestic economy China is in urgent need of new economic growth points.For this reason,the Chinese government has formulated a set of policies and regulations related to M&A,which has triggered relatively strong domestic enterprises.Willingness for mergers and acquisitions.In this context,domestic companies’ mergers and acquisitions have become more frequent,showing consistent and intensive characteristics,forming continuous mergers and acquisitions.This article selects Donghua Software Co.,Ltd.as the research object,and uses case analysis,comparative analysis,principal component analysis and other methods,and uses Donghua Software announced mergers and acquisitions from 2013 to 2017 as samples to study the reasons for its continuous mergers and acquisitions.And economic consequences.Donghua Software’s continuous mergers and acquisitions are mainly for the purpose of laying out the industrial chain,pursuing synergies,while reducing entry barriers when entering other industries,looking for new profit growth points and reducing the overall risk of the company;at the same time,Beijing is to help software as its pillar industry The industry is developing faster and better,and it has also given certain policy support to the mergers and acquisitions of software companies.After the merger,from the analysis of Donghua Software’s operating income by region and industry,and the situation of R&D personnel,it has indeed realized the motivation of continuous M&A of Donghua software,but it also brought many problems.Due to the frequent occurrence of high-premium mergers and acquisitions and cash payments,the company’s performance has been seriously affected,and financial risks have been caused.The overall long-term performance of the company has also shown a downward trend.In general,the continuous mergers and acquisitions of Donghua Software have not been successful.Finally,based on the conclusions drawn from the analysis case,several countermeasures were put forward for the company itself.Based on the research and analysis of Donghua Software’s continuous M&A cases,this article hopes to provide some valuable suggestions for other companies in the same industry that have the idea of continuous M&A.