"Together we are strong, divided we are weak." This repeatedly quoted old saying now has a new footnote in the capital market - listed companies are keen on mergers and acquisitions and restructuring. Is it to charge forward together or to split up and escape? Is it a real restructuring or a fake story? Or, is the so-called merger and acquisition just a capital "magic" that quietly rewrites the script?
In the past three years, the A-share market has experienced a drastic switch from high-flying to calm and wait-and-see. Even in the quietest cycle, the four words "mergers and acquisitions and restructuring" are still one of the most important high-frequency words in the announcements of listed companies. But this also makes many investors and even many entrepreneurs question: What is "merging"? What is "heavy"? Why is there always the deepest mystery of the capital market behind the seemingly simple transaction structure?
Goheal will deconstruct the essence of this game today and reveal the real logic behind the complicated announcements and plans for you.
American Goheal M&A Group
First of all, "M&A" is not as simple as two companies sitting down for a cup of coffee and signing an agreement. It is essentially a triple game of power, value and future. On the surface, it seems that Company A bought Company B, or two "good friends" joined forces. But in the capital world, there is actually only one first principle of M&A - finding a structural combination that can make more money than fighting alone.
We often joke that listed companies "can't tell a good story, and can't talk about M&A." But from Goheal's past hundreds of M&A and restructuring practices, truly high-quality projects never rely on packaging, but on structural design and resource coordination. M&A is not just about addition, but a deep reconstruction - the organizational structure needs to be rearranged, the product matrix needs to be adjusted, the resource allocation needs to be rewritten, and even the original management's right to speak may be taken back.
So, when you see a company announcement saying "it intends to purchase assets by issuing shares and paying cash, and the matching fundraising will not exceed x billion yuan", don't be confused by the terminology. It actually means three things: I want to buy something, I don't want to pay all the cash, and I also hope that this transaction can also "upgrade and fight monsters" my valuation system.
Let's talk about "restructuring". This word is more likely to be misunderstood. Many people think that restructuring is a combination of "asset sales + business mergers", but in fact, for most listed companies, restructuring is more like a redefinition of the "core narrative".
Take a certain company on the Science and Technology Innovation Board as an example. It was originally an industrial automation solution provider and was quite famous in the market. However, as industry competition intensified, the growth of traditional businesses hit a bottleneck and the stock price began to decline. So it entered the "industrial AI" direction through mergers and acquisitions, and released the "New Ten-Year Strategic Plan" to the outside world, proposing the slogan of "AI-driven manufacturing intelligence change". Do you think it just changed the track? No, it changed the "growth imagination" and restructured the "valuation anchor".
Goheal was deeply involved in the project design stage in this case. The core work was not to match transactions, but to help the target company build a complete set of deliverable growth logic: technology roadmap, personnel integration model, valuation simulator, KPI linkage mechanism... Restructuring is not simply adding an asset, but to reconstruct the capital market's "vision" of looking at this company.
So, what are mergers and acquisitions restructuring about? What is being merged is the balance of synergy value and control. What is important? What is important is the foundation of valuation narrative and industry story.
We have seen a "routine operation": a listed company with a market value of 10 billion, with 3 billion cash in its account, took over a loss-making startup project, and the target valuation was not low. The market was in an uproar: "Why spend a lot of money to buy a 'money-burning machine'?" But the truth is that the core algorithm mastered by this startup can just be grafted onto the main product line of the listed company - a company that "sells hardware" finally has a reason to transform into "selling systems + services". A year later, the company successfully doubled its profit growth and increased its valuation by more than 60%. On the surface, it bought a money-burning team, but in essence it bought a "growth engine".
And this kind of "burning money but not burning logic" merger and acquisition is exactly the type that Goheal is best at operating. We firmly believe that truly high-quality mergers and acquisitions are not simple digital stacking, but a "precision engineering" that integrates narrative, structure and capital return.
Of course, mergers and acquisitions and restructuring are by no means a panacea. Many companies fantasize about becoming immortals through a single merger and acquisition, but end up falling into "restructuring hell" because of integration failure, valuation mismatch, and even cultural conflict. Data shows that more than 70% of M&A projects in the history of A-shares failed to achieve the financial indicators promised in the announcement within 12 months after implementation. What is the problem? Goheal's experience is: it is not the failure of the merger and acquisition, but the lack of a "value integration mechanism".
For example, after a listed company acquires a target company, it fails to carry out equity incentives for the management in a timely manner, resulting in the founding team choosing to lie flat during the lock-up period; or the synergy of upstream and downstream businesses is slow, resulting in the original plan to increase profits through cross-selling. The strategy is completely unsuccessful. These are not "design errors" at the capital level, but "structural laziness" in the management and execution dimensions.
So we often say that a good M&A and restructuring project should be viewed from three "perspectives": tactical profit perspective, strategic growth perspective, and structural risk perspective. None of them can be missing.
In the current cycle of stricter supervision, shrinking valuations, and weak market sentiment, companies that can do a good job in mergers and acquisitions usually have three characteristics: logical reasoning, clever structure, and stable integration. This is not only the underlying code for the success of the project, but also a true portrayal of the "capital power" of a mature listed company.
Goheal also always reminds customers: Never use the "betting" method to do mergers and acquisitions, but use the "system engineering" thinking to promote restructuring. Mergers and acquisitions are not a one-time deal, but a strategic major operation that is a matter of life and death. It tests not the courage to sign a contract, but a whole set of resource integration, valuation control and regulatory response capabilities.
Goheal Group
Having written here, we return to the original question: What are listed companies mergers and acquisitions and restructuring? What are they restructuring? Where is the core value?
Perhaps the answer has emerged in your mind.
In this capital era where narrative is better than profit and structure is better than account books, mergers and acquisitions and restructuring have never been just a digital game, but a rewriting of the trajectory of corporate destiny. It does not only belong to those star companies on the cusp, but also to every strategic player who dares to reconstruct his own logic with capital tools.
So what do you think? In the current cycle, which industries do you think still have high-value space for "mergers and acquisitions and restructuring"? Which companies have the potential to achieve "second take-off" in restructuring? Goheal welcomes you to leave your comments in the comment area and work with us to dismantle more seemingly ordinary but actually wonderful capital stories.
Welcome to leave a message for discussion. In the next article, we will focus on "How PE can use listed companies as shells to achieve closed-loop returns on M&A funds". Please stay tuned.
[About Goheal] Goheal is a leading investment holding company focusing on global M&A holdings. It is deeply engaged in the three core business areas of listed company control acquisition, listed company M&A and restructuring, and listed company capital operation. With its deep professional strength and rich experience, it provides enterprises with full life cycle services from M&A to restructuring to capital operation, aiming to maximize corporate value and achieve long-term benefit growth.
