A Case Study On The Failure Of Ningbo Dongli’s M & A Of Nianfu Supply Chain

In recent years,China’s economic system has been continuously improved.With the full implementation of the supply side structural reform,more and more enterprises are seeking transformation in development,hoping to increase the core competitiveness of enterprises by changing the old business model.M & A can effectively increase the allocation of resources and broaden the market scale.Successful M & A can help enterprises achieve leapfrog growth in performance.Therefore,more and more enterprises choose M & A as a way of transformation.However,M & A is a continuous process,which usually spans multiple financial periods.Various risks in the process of M & A integration greatly increase the uncertainty of M & A.With the continuous expansion of the scale of M& A in China,the failure rate of M & A has not been effectively controlled,and there are still a large number of M & A cases that end in failure.Therefore,how to effectively identify the causes of the failure of M & A and fundamentally improve the success rate of M & A in China is an urgent problem to be solved.This paper analyzes the case of Ningbo Dongli’s M & A of Nianfu supply chain,and expounds in detail the whole process from M & a planning to M & a failure.Based on the in-depth understanding of the operation status of the acquirer before M& A,and combined with the current development status of China’s manufacturing enterprises,this paper analyzes the motivation of enterprises pursuing M & A in detail.The comparison of various financial indicators before and after M & a confirmed the bad financial situation of enterprises.By reading the literature research related to this M & A and reviewing the M & a process,this paper expounds the reasons for the failure of M & A in detail from three aspects: the acquirer,the acquiree and the external law and supervision.After the analysis,this paper puts forward four suggestions for the above failure reasons,which can be used as a reference for enterprises planning M & A.Through the research,this paper finds that the failure of M & A is caused by a variety of reasons,and there are reasons for the failure of M & A in each process from M & a planning to the subsequent integration stage.From the perspective of the acquirer,the preparatory stage is reflected in the excessive valuation of the target company and excessive overdraft of resources for external M & A.In the subsequent integration process,the enterprise ignores the main business R & D and puts all its focus into the service chain business.For the acquired party,the signing of the M & a agreement always intends to conceal the real business situation and financial data,so that the acquirer can complete the M & A without knowing it.After the merger,its business model and a large number of accounts receivable have greatly increased the financial risk of the merged enterprise.From the perspective of external factors,the existing M & A laws and regulations are not perfect,and the intermediary investigation institutions have not fulfilled their responsibilities.Therefore,before M& A,enterprises should pay attention to these factors that are easy to lead to failure and formulate strategies to deal with them,so as to improve the success rate of M &A.