A Study On The Influence Of Premium Merger And Acquisition On Corporate Performance From The Perspective Of Valuation Adjustment Mechanism

Due to the optimization of industrial structure and the implementation of supply-side reform in recent years,many traditional enterprises,especially traditional industrial enterprises,fall into a development dilemma.In order to deal with this dilemma,the adjustment of enterprise strategic planning and management structure has become the necessary measures for enterprise development.Therefore,many traditional enterprises choose to enter the industry market with technological advantages or great development prospects through mergers and acquisitions,and solve difficulties through transformation.With the rise of the popularity of M&A market,the share of high premium M&A based on high valuation in M&A market is gradually increasing.As a financial instrument,the valuation adjustment mechanism can reduce the risk caused by information asymmetry between the two sides of the merger and acquisition,so it is used by more and more enterprises in the merger and acquisition transaction.However,when evaluating the value of the target company,due to its signal transmission effect and performance compensation provisions,the acquirer will rely heavily on valuation adjustment mechanism,leading to a further rise in the M&A transaction price,finally cause the M&A failed cases occur in succession,causing a bad impact on the M&A enterprise and our capital market.This paper takes Dalian Sunlight Machinery acquisition of Meijiemu as a case study to analyze the impact of the bet agreement on the performance of Dalian Sunlight Machinery premium merger.First,the relevant national and international literature and theoretical foundations are reviewed,laying the groundwork for the subsequent writing of the thesis.Secondly,the company profiles and industry conditions of Dalian Sunlight Machinery and Meijiemu are introduced,and the cases are presented from four aspects: analysis of the driving force of bet merger and acquisition,introduction of the M&A process,setting of the terms of the valuation adjustment mechanism,and execution of the valuation adjustment mechanism.The second part is a case study that analyzes the impact of the valuation adjustment mechanism on high-end M&A performance.Identifying and analyzing the risks of the valuation adjustment mechanism in corporate premium M&A;examining the impact of the valuation adjustment mechanism on M&A performance in terms of short-term market performance.and the analysis of financial indicators of premium M&A based on valuation adjustment mechanism.The final part of the paper concludes with conclusions and recommendations,and describes the shortcomings of the paper and points out the directions for further research.The conclusion of this paper is as follows: firstly,in the short term,the valuation adjustment mechanism can play a positive role in the company’s performance level,especially the profitability;Secondly,through the risk analysis of valuation adjustment mechanism in premium M&A,it can be concluded that after the implementation of valuation adjustment mechanism,due to the large differences between the two parties in business model,management structure and market environment,the integration risk of enterprises after M&A will rise,resulting in the decline of their business ability.At the same time,the unreasonable terms of the gambling agreement will make the enterprise face the possibility of gambling failure;Based on the study of the impact of valuation adjustment mechanism on M&A performance,it is concluded that in the M&A signed with valuation adjustment mechanism,the factor mainly linked to the risk of goodwill impairment is the enterprise’s operating ability.If the acquired party has major operating problems,it will directly lead to the significant impairment of goodwill,and then affect the M&A performance of the enterprise.Finally,based on the above analysis,the paper puts forward some specific inspirations and suggestions for the failure of Dalian Sunlight Machinery betting,and also provides reference for the development of other enterprises and industries,in the hope that the valuation adjustment mechanism can be more perfectly applied in our capital market.