Research On FX Pharmaceutical M&A Based On Overseas Expansion Strategy

In recent years,domestic and foreign drug market competition is increasingly fierce.Scale and globalization have become the new trend of the development of Chinese pharmaceutical companies.In order to achieve the development and growth of companies,in addition to relying on internal accumulation,they should also make full use of capital operation methods,such as mergers and acquisitions,to achieve external expansion and development.At the same time,with the proposed "Made in China2025",the central government has taken a series of measures to promote mergers and reorganizations among pharmaceutical companies,optimize the industrial layout and enhance their competitiveness in the international market.However,cross-border mergers and acquisitions are costly,risky and fail cases are common.Blind determination of M&A target will cause the positive effect of M&A is not obvious,and even lead to the destruction of enterprise value.Therefore,it is particularly important to study transnational mergers and acquisitions in line with company development strategy.This thesis adopts the method of combining basic theory research with concrete examples.First of all,the research status at home and abroad is summarized,such as the relationship between enterprise strategy,M&A strategy and M&A performance,motivation of cross-border merger and acquisition and M&A performance evaluation method.It is found that there are large differences in academic circles on whether transnational mergers and acquisitions based on company development strategy can improve company performance.FX Pharmaceuticals is a typical private company that has grown through continuous mergers and acquisitions.Therefore,this thesis takes FX Pharmaceuticals as the research object and finds that it has implemented a series of cross-border mergers and acquisitions under the guidance of its overseas expansion strategy.Then,in order to further analyze the implementation and performance of overseas expansion strategy,two typical events in the history of cross-border M&A are selected—the acquisition of Alma,an Israeli maker of medical and aesthetic devices,and Gland Pharma,an Indian maker of generic drugs.Starting from the merger process and strategic intention of two specific acquisitions,this thesis evaluates the implementation of overseas expansion strategy by using non-financial indicators.Finally,based on the two dimensions of financial performance and management performance,a comprehensive analysis and evaluation of the two cases of M&A performance.It is found that the two M&A events have successfully implemented the company development strategy,but the M&A performance presents opposite results.And the main reason for the difference is the degree of control of the overall risk of M&A and the degree of adaptation between the development strategy and the status quo of companies.Three suggestions are put forward.(1)Transnational merger and acquisition should be combined with enterprise development strategy;(2)Focus on the selection of cross-border M&A targets;(3)Transnational M&A should pay attention to the dynamic adjustment of M&A strategy.Through the comparative analysis of these two merger cases,it is expected to provide some enlightenment and suggestions for Chinese companies’ transnational mergers and acquisitions.