M&A Goodwill in Chinese A-share listed companies: Findings from Industrial and Regional Perspectives

Abstract

Based on the data of China's A-share listed companies from 2007 to 2021, this paper conducts a multidimensional statistical analysis on the confirmation and impairment of M&A(M&A) goodwill of listed companies from the perspective of industry and region. The results of statistical analysis show that:(1) On the whole, the changes of goodwill related indicators can be divided into three stages: small M&A in the budding stage; the sharp increase of goodwill and risk of its impariment in the boom stage; the order and standardization in the stable stage.(2) In terms of industry, the number of listed companies in the Manufacturing Industry was the largest, and their goodwill changes were the most representative. Goodwill in Culture, Sport and Entertainment and Health and Social Work was of low quality and high risk. Hotel and Catering Sectors, Mining and Transportation, Storage and Postal Services were the "goodwill-high-quality" industries. Agriculture, Forestry, Animal Husbandry and Fishery, Scientific Research and Technical Services, and Comprehensive Service belonged to the "goodwill-conservative" industries.(3) In terms of region, North China, led by the Beijing-Tianjin-Hebei economic circle, was the leader in China's M&A market. In the budding stage, there was little confirmation for goodwill and provision for goodwill impairment in regions outside North China. During the boom stage, goodwill related indicators rose sharply in all regions. In the stable stage, the value of goodwill in each region did not change much, but the average value of provision for goodwill impairment increased, especially in northeast China and central China.