Research On The Motivation And Economic Consequences Of Continuous Mergers And Acquisitions Of KYLAND

With the advent of the technological era,Internet technology is developing with each passing day,and has penetrated into all aspects of people’s lives,becoming the most indispensable part of today’s era.However,due to the rapid upgrading of Internet technology and the number of companies of the same type,market demand is also continuously changing.In this context of unprecedented fierce competition,many Internet companies are no longer satisfied with developing in a single field,but have also made continuous external acquisitions to enable them to explore different segments and improve their competitive advantage in the market.Although continuous mergers and acquisitions can help enterprises quickly expand the market,blind continuous mergers and acquisitions may also bring some economic risks to enterprises.Through reading the existing research literature of predecessors,it is found that there are many studies focusing on the economic consequences of single mergers and acquisitions for enterprises,and there is a lack of research that considers continuous mergers and acquisitions as a whole.Based on the collation of relevant literature on mergers and acquisitions,this article selects KYLAND,a leading enterprise in the industrial internet industry,as the research object,and studies the continuous external acquisition behavior of KYLAND with the help of diversification and market power theory.After a detailed introduction to the entire continuous M&A activity,the internal motivation that drives it to occur is analyzed.Then,the event study method is used to analyze them and evaluate the shortterm economic consequences of their continuous mergers and acquisitions.Then,through non-financial and financial analysis methods,evaluate the long-term economic consequences of its continuous mergers and acquisitions.Among them,the nonfinancial analysis method is Tobin Q-value method,and the financial analysis method is financial indicator analysis method.Based on the financial data during continuous mergers and acquisitions,evaluate the operational,management,and financial synergies of KYLAND;Finally,through the analysis of the economic consequences of continuous mergers and acquisitions of KYLAND,it is concluded that the economic consequences of continuous mergers and acquisitions of KYLAND have slightly improved in the short term,both in terms of individual mergers and acquisitions and in terms of the overall situation.However,from a long-term perspective,financial indicators such as business income or net profit of an enterprise reflect the inability to maintain long-term stability.That is,after the end of crazy acquisitions in 2019,almost all financial indicators have plummeted,and the good financial data of KYLAND can only be maintained through continuous mergers and acquisitions.The economic consequences of such pessimism are mainly caused in several aspects: First,the resources for mergers and acquisitions have not been effectively integrated.There is no synergy between various resources such as funds,technology,and human resources.Secondly,there are problems with the payment methods adopted.KYLAND has paid in cash in all merger and acquisition transactions,which not only puts pressure on the company’s working capital and affects its normal operation,but also owes a lot of shortterm loans,causing the company’s capital cost to rise sharply.Third,improper selection of acquisition targets.There are many companies in unfamiliar fields in the companies acquired by KYLAND.KYLAND is unable to integrate businesses in new fields well,and lacks management experience in these fields,resulting in the failure to achieve the expected acquisition results.This article proposes several inspirations for the above issues: First,improve the resource integration ability of enterprises.Only by fully integrating technology,human resources,and other resources to achieve resource synergy can the core competitiveness of enterprises after mergers and acquisitions be effectively improved.Second,adopt diversified payment methods.To ensure cash flow and avoid debt risk.Third,rational selection of acquisition targets.I hope to provide reference for enterprises themselves and other enterprises that have continuously acquired and acquired.