Principles of Corporate Mergers and Acquisitions

Author: Chen Gong
Publisher:
Publish Date: 2002-04-01
Features: This book is set against the backdrop of the Western market economy and modern corporate system. After systematically introducing the basic theories of corporate mergers and acquisitions, it focuses on elaborating the specific planning and operational processes of corporate mergers and acquisitions. This will be a rather complex process, as it integrates knowledge from many disciplines such as law, economic theory, and accounting, and requires a strong ability to connect theory with practice. China is currently in a dynamic era of mergers and acquisitions, with new theories and practices emerging frequently, and the discussions in related books are diverse and complex.
The purpose of this book is: to present the general principles of mergers and acquisitions from a new perspective, enabling readers to, on the one hand, systematically grasp the knowledge framework related to mergers and acquisitions through reading, and on the other hand, capture the latest changes in knowledge, understand the current dynamics of the mergers and acquisitions market, and grasp the essence of mergers and acquisitions through new case studies.
This book is based on the China Securities Industry Practitioners Business Training and Qualification Examination Selected Texts, Volume 6: Corporate Mergers and Acquisitions Principles and Cases, organized and compiled by the Institute of Finance and Securities at Renmin University of China. After revision, the characteristics of some chapters are as follows:
Chapter 1 focuses on summarizing and clarifying the relevant concepts and terms related to mergers and acquisitions, as well as the intersections and ambiguities in their connotations and extensions, given the varying understandings of terms such as "mergers and acquisitions," "acquisition," "merger," "consolidation," and "reorganization" in recent years, as well as the evolving interpretations by practitioners in the fields of practice, accounting, and law.
Due to the significant development and revision of competitive strategy theory in recent years, Chapter 4 includes the content of mergers and acquisitions strategy analysis.
Chapter 5 adds new evaluation methods for target companies under the new economic environment.
Chapter 6 introduces valuation topics based on venture capital, valuation of intangible assets of high-tech enterprises, and the option pricing method, building on the widely used concepts of risk assessment in the market.
Chapter 7 focuses on revising the content related to equity payment methods due to the frequent occurrence of stock-for-stock mergers and acquisitions cases in China's securities market, with additional relevant cases added to the case analyses.
Chapter 8 tentatively draws on foreign leveraged buyout (LBO) practices and analyzes the environmental constraints on LBOs in China in the subsequent LBO.
Due to the shock caused by anti-competitive cases involving U.S. companies like Microsoft, legal regulation of corporate mergers and acquisitions has been increasingly emphasized by regulators and the legal community in China, as well as by the growing body of research in this area. Chapter 9 provides a general overview of the general knowledge of anti-competitive issues in mergers and acquisitions.
Chapter 10 covers accounting and tax issues in corporate mergers and acquisitions. Due to the significant progress in China's recent accounting and tax reforms, which have both aligned with international standards and retained at key points, this chapter fully incorporates the new research findings from the fields of accounting and taxation and makes substantial additions. However, many issues in this chapter may still undergo significant changes in the future, given that China's consolidation accounting standards have not yet been finally issued and the international debate between U.S. standards and international standards remains fierce.
This book includes an analysis of the interests of all parties involved in mergers and acquisitions, as "all changes ultimately reflect adjustments and redistribution of interests." A thorough analysis of the interests of all stakeholders in mergers and acquisitions helps to understand the success and failures behind the scenes.
This book also adds content on post-merger integration, as the effectiveness of integration in recent practice has become increasingly important for the success of mergers and acquisitions, and China has seen many classic integration cases. "Integration" has also become a very fashionable economic term. However, due to space constraints, this chapter only provides a basic conceptual explanation.
Chapter 13 is divided into two parts: cross-border mergers and acquisitions of foreign-invested enterprises in China and cross-border mergers and acquisitions of Chinese enterprises in foreign countries. With China's entry into the WTO and economic globalization, Chinese enterprises will increasingly engage in international cross-border mergers and acquisitions.
This book adds topics on anti-takeover strategies, leveraged buyouts, and management buyouts, as well as a review and outlook on global corporate mergers and acquisitions. This is because acquisition and anti-takeover have become hot topics frequently covered by the media in China's securities market, and leveraged buyouts and management buyouts are also common events in the securities market. A review and outlook on global corporate mergers and acquisitions is not just a list of materials by the author but also aims to leave readers with more reflection on the global review and prospects of mergers and acquisitions.
Chapter 17 cites some new cases and related materials, and the authors would like to express their gratitude to the authors of these cases. The purpose of this citation is to help readers deepen their understanding of the principles and concepts in the previous chapters through case studies. In the selection process of cases, this book adopts a broad definition of mergers and acquisitions, which not only includes narrow definitions but also includes spin-offs, joint ventures, and strategic alliances, aiming to demonstrate the diverse, thought-provoking, and worth-continuously researching and exploring "profound connotations and broad concepts" of mergers and acquisitions restructuring.