Research on the Key Factors for a Successful Merger and Acquisition

Abstract

M&A is an important activity of corporates in today's competitive business environment. Previous researches on the influencing factors of M&A were mainly based on the theory of synergy effect, market power theory, economies of scale theory and so on. Moreover, there are no unified conclusions. Starting from HSBC's M&A of AXA Singapore, this paper studies the influencing factors of M&A through literature research and case analysis. In the end, three main influencing factors were derived. One is synergy, represented by Haier Group merging Red Star Electric Appliance Company and Citibank merging Travelers Group. The second is technology, the representative cases are Cisco acquisition of IMImobile and Salesforce acquisition of Slack Technologies. The third is market share, and corresponding cases are J&R Express' acquisition of Best Express and LVMH's acquisition of Tiffany. Enterprises can obtain synergies, innovate with technology, expand market share through M&A. Therefore, they can obtain more profits, and support the healthy development of enterprises. Finally, this paper suggests that enterprises start from various factors such as the market environment and their own conditions to make M&A decisions and promote the benign development of enterprises.