Research On The Motivation And Financial Performance Of Baidu’s Acquisition Of YY Live

The China Internet Information Center has released the 49th statistical report on the development status of the internet in China.By the end of 2022,the number of internet users in China had exceeded 1.051 billion,while the proportion of internet users at the national level had also exceeded 73%,the number of users aged 60 and over had exceeded 119 million,and internet coverage by elderly users had exceeded 43.2%.The number of hours of internet use per capita also continued to rise,with the number of online office users exceeding 469 million and the number of online medical service users rising rapidly to 295 million.The increase in the number of Internet users and Internet penetration created good conditions for the development of the live streaming industry,which led the Internet industry to show an upward trend;and increased the market share of the Internet industry,which helped to play out the coordinated effect of resources to improve the performance level of the industry.Baidu,a wellcapitalized and established online company in China,is now trying to enter the live streaming sector through the acquisition of YY Live,in order to enter new markets and improve its financial performance as the penetration of the internet increases and the influence of Jitterbug and Racer grows.This paper takes Baidu’s merger and acquisition of YY Live as the research object,reviews the domestic and international literature,and adopts a combination of theoretical research and case studies,as well as a broader review of domestic and international research on mergers and acquisitions.First,the theoretical framework relevant to this study is introduced and the process of mergers and acquisitions is described.Then,Baidu’s motives for merging and acquiring YY Live are examined in depth.Using the financial performance method,EVA adjustment method and non-financial indicator method,Baidu’s financial performance before and after the merger and acquisition of YY Live is analyzed in the long and short term.Finally,the study finds that the M&A parties have fully exploited synergies to obtain additional resources,the development of Baidu’s financial performance has been positive,and Baidu’s overall capacity has improved after the merger and acquisition,but there are still some problems in the M&A process.Based on this,this document also makes relevant recommendations:first,to use professional institutions for due diligence;second,to choose a reasonable financing method to reduce financial risks;and third,to improve the management system to facilitate the integration of the company.In addition,national mergers and acquisitions of companies in the live streaming sector are still relatively rare,and we hope that the case study of Baidu’s acquisition of YY Live will provide insights for future mergers and acquisitions in the live streaming sector.Finally,it remains to be seen how Baidu’s acquisition of YY Live will develop in the long term.