A Study On The Performance - Berfore And After Business Merger And Acquisition

• Main Authors: Shu-Fen Lee, 李淑芬
• Other Authors: Hsin-Hong Kang
• Format: Others
• Language: zh-TW
• Published: 2006
• Online Access: http://ndltd.ncl.edu.tw/handle/58995129309663192968

碩士 === 國立成功大學 === 高階管理碩士在職專班 === 94 === In recent years due the fierce change of overall economy, and the rapidly evolving industry environment, enterprises seek opportunities to grow, which induces many companies undertaking Merger and Acquisition (“M&A”). In Taiwan, since later 1980’s, M&A began to occur among large enterprises and at the beginning of year 2000, M&A activities in Taiwan became more intense. As a result of this, at the end of 2001, Taiwan government decided to amend Corporation Law in a considerably large scale. Furthermore, the Legislator passed the Enterprises Merger and Acquisition Legislation in 2003. This enactment allows Enterprises to have simplified M&A processes, which at the same time, encouraged and induced M&A activities domestically. Nevertheless, the effectiveness of M&A and its actual impact on enterprises have always been the interested research subject among many companies and scholars. In the past, there were not as many M&A projects happened in Taiwan for us to research, and besides, varieties and evidences in the sample pool were very limited for the purpose of research. Research results therefore tend not to provide much objectivity. Until recent years, due to fierce competition among various industries as well as the encouragement of Taiwan government by enacting M&A law, there have been significant amount of M&A projects happening in the business industry. Consequently, in terms of investigating the real management effectiveness of M&A processes on enterprises in the long term, there are more cases in the sample pool available for research and therefore allow researchers to show more objectivity to the results. This research is aimed at examining all financial performance indicators, sampling from all publicly listed companies M&A occurred from 1992 to 2003 with an objective to investigate the long term operational influence on the companies resulting from M&A activities. Furthermore, it also analyses the driving factors behind M&A activities, such as take-over companies’ operational efficiency before merger and the impact of the replacement of management team after merger, industries compatibility, the take-over company industry development, the location of takeover target companies and so on. We attempt to understand how these driving factors influence post-merger companies’ operational efficiency in the longer timeframe. Major evidences indicate that M&A activities in Taiwan do not allow companies to generate operational efficiency and synergy. These improvement might be seen when there are economics of scales in manufacturing and therefore result in better leverage in operation and stock turnover. However, in general, the financial performance indicators appear to be worse than those prior to M&A occurred. This finding is consistent with many relevant research evidence found by researchers overseas. On the other hand, looking from the yield perspective, in general, M&A activities have negative impact on companies Return on Assets and net profits. Also, the correlation of industries the companies merge to, have significant negative influence on the companies revenue growth but have positive influence on Gross Margin. Furthermore, these activities generate negative results in Assets Turnover and Stock Turnover. On the other hand, operational efficiency before take-over and the prudence in decision making processes have strong optimistic influence on the Return on Equity and Assets. In essence, research results illustrate that companies having good management team with excellent history in operational efficiency and well-thought planning in decision making as well as cash flow processes, they tend to have improving Return on Equity and Assets post the M&A activities.