The Effect of Green Mergers and Acquisitions on the Performance of Heavily Polluting Enterprises: A Case Study of Gezhouba Group in China

This paper adopted a case study approach to investigate the green mergers and acquisitions of a heavily polluting enterprises in order to understand the resource integration path after its acquisitions, and to reveal the heterogeneous impact mechanism of green mergers and acquisitions on enterprise performance. This paper introduces resource dependency theory and sustainable development theory to explore the motivation and process of enterprise mergers and acquisitions, and uses synergy theory to explore the results of enterprise mergers and acquisitions. The re-search findings indicated that the green mergers and acquisitions behavior of enterprises comes from the dual drive of external pressure and internal motivation. External pressure comes from the constraints of the external macro environment such as politics, economy, society and technology. The internal motivation comes from the green transformation and upgrading needs of enterprises. After green mergers and acquisitions, enterprise quickly acquired green technology, technical personnel, environmental protection equipment, market customers and management experience in the field of water treatment. It integrates resources by updating the concept of green development, strengthening the research and development of green resources, improving the management and operation of green production, and integrating the water industry chain. And the integrated resources were applied inside and outside the company. It optimizes traditional business production internally, provides environmental protection services externally, and finds new sources of profit for enterprises. The enterprise’s market performance, financial performance and environmental performance all have been improved after its mergers and acquisitions. Although this study focused on just one Chinese heavily polluting enterprise, it should still provide some insight for the better understanding of green mergers and acquisitions practices of heavily polluting enterprise s in general.