Case Study And Performance Analysis Of The Merger And Acquisition Of Unification Petrochemicals By Xiangli Stock

The tough and uncertain external environment,combined with contracting demand,supply shocks and poor expectations,has hit business operations hard.State-owned enterprises with social responsibilities or poor transformation were particularly affected.In order to avoid risks in the capital market,the Securities Regulatory Commission has strengthened the audit of listed companies,and several companies were warned of delisting,including Xiangli shares.The agricultural products business of Xiangli shares faced multiple obstacles such as demand contraction and labor logistics,which led to a decline in revenue and was put on the delisting warning list.In order to enhance the competitiveness,Xiangli stock chose to enter the chemical market through restructuring,and successfully became a double main board listed company.It is worth noting that,as a state-owned enterprise,Xiangli did not deal with related parties,nor was it restructured within the same industry,but financed and acquired unified shares,entered the chemical market in one go,and became a double main board listed company.Although from the result,in 2022,Xiangli shares were delisted successfully,but whether this restructuring of stateowned assets is an effective operation with great effect is still to be proved.In this paper,we analyze from the time when Xiangli was delisted warning to the end of2022.Firstly,this paper uses event analysis method to analyze in detail from the important aspects such as the subject involved in the M&A event,the M&A plan,the financing method and the performance commitment,in order to derive the purpose and performance of the specific M&A subject in the M&A and the expected impact on the future business,and through the analysis of some major events,weaknesses and hidden problems in this M&A,to analyze the operation and profitability of the company Secondly,this paper uses financial analysis to analyze the entire M&A process and its effects by comparing the changes in major accounts in the balance sheet,income statement,and cash flow statement before and after the M&A and exploring the reasons for the changes in the accounts with large changes in order to show the M&A process at a deeper level.In addition,through the calculation of financial indicators,comparing the changes of solvency,operating capacity and profitability of Xiangli before and after the M&A,the analysis conclusion of the M&A is drawn from the macro perspective of finance;because Xiangli is a listed company,and whether it is starred or unstarred is also an act in the capital market.This paper then uses TVP-VAR model to analyze its impact feedback in the capital market.Comprehensive analysis of the above several perspectives can draw the following conclusions:the diversification of capital after the restructuring of Xiangli shares helps to reduce operating risks,while the main business of the merged party is strong also helps Xiangli shares to reduce the difficulties of entering new fields.However,the company’s previous results of entering new industries are not good,and the cross-industry M&A has the risk of uncertain future;the M&A behavior of Xiangli shares has positive and negative effects on the operating capacity,and the total asset turnover ratio increases in general.However,the M&A behavior makes the Xiangli shares face the debt service challenge and financial risk.Debt climbed,but the actual profitability did not improve significantly.The surge of goodwill led to a less than optimistic net profit after goodwill.A large amount of financial leverage makes the return on investment lower,weakening profitability;asset turnover and operational efficiency have increased after the restructuring,but the M&A act makes Xiangli shares face debt servicing challenges and financial risks;the traditional auto market industry may be more affected by new energy vehicles,so it is difficult for Xiangli shares to reach performance commitments;the M&A act has a boosting effect on short-term stock performance,but after may not be optimistic.Irrational factors will affect the stock price in the short term,but the fundamentals are the only basis to support the market value of the stock.