Risk Assessment Of Mergers&Acquisitions Based On DHGF Integration Algorithm

Mergers and acquisitions in the context of global economic fluctuations and decline,with its unique property rights transactions, through the transfer of ownership of corporatecontrol over the transfer and reorganization of resources, has increasingly become animportant way to grow outside the enterprise. SFC2008-2009,2012-2013on the issue ofwindow control, as well as the issue of the cumbersome approval process and wait for a longtime and other factors continue to accumulate, the issue began to fade out of the capitalmarket, which also happens to be bred for the development of the M&A more opportunities.Since1995, the total amount of Chinese M&A market transactions showing a rising trend;slow trend in the average transaction value of mergers and acquisitions of Chinese enterprisessince2001; recent years, especially since the global financial crisis in2008, the mergers andacquisitions of Chinese enterprises shows the extraordinary vitality.With the commencement of the mergers and acquisitions, M&A risk management ismore and more entrepreneurs and academic attention. M&A risk is the failure of mergersand acquisitions reduce the market value and the rising costs of management, or thepost-merger market value erosion. From the characteristics of corporate mergers andacquisitions, and domestic and international mergers and acquisitions practice, M&A is ahigh-risk, capital management activity. M&A process has high-risk due to a variety ofuncertainties. Merger risk assessment first is based on a detailed understanding of the basis ofthe composition of the M&A risk, followed to the vario us stages of the M&A riskidentification, set up M&A risk index system, and finally sucked the M&A risks as asystem, the use of mathematical methods knowledge uncertainty measure system information.M&A risk assessment can provide a number of favorable support for M&A decision, acareful look at the complex and abstract decision-making process, with a number of methodsto measure the risk of M&A program size, it is a key part of the M&A risk managementchain, but also the M&A risk management the difficulty. Therefore, to explore the use ofquantitative methods to measure the risk of mergers and acquisitions has important practicalsignificance to strengthen the risk management of corporate mergers and acquisitions, thetheory and practice of choosing this topic has double meaning. The innovation of this paper is that the M&A risks as the system, drawing on theknowledge of information systems and fuzzy mathematics to quantify the size of the systemof risk. Uncertainty of the system (or things) has4kinds. Just like the usual randomness,fuzziness, gray and non-deterministic. Common analytical methods corresponding to thissystem of fuzzy mathematics and gray theory, the fuzzy math analyzed connotation clear, theepitaxial system does not clear, gray system analyzes the connotation is not clear, clearepitaxial system. In the process of mergers and acquisitions, corporate mergers andacquisitions demonstrate the characteristics of the gray system that is part of its informationexplicitly part of the information is not clear, although with the in-depth investigation of thetarget company, can improve the quantity and quality of access to information, but becompletely control is impossible. Knowable information is not all the information fordecision-making mergers and acquisitions, some closely related to mergers and acquisitions,risk, while others have little relevance. This form of a message is not completely sure ofmulti-criteria decision making system. How do I know what information on the impact of M&A decision-making, what information is and is not associated with M&A decision on theestimated index weights; actually contains the contents of each message on the M&Adecision, which is the index value of the main objective assignme nt problems. Not clear thisextension and intension subsystem, we can apply to try to find a composite fuzzy mathematicsand gray theory innovation evaluation the algorithm-DHGF comprehensive integrationalgorithm to evaluate.The comprehensive integration DHGF algorithm theory is based on the gray theory andfuzzy mathematics from qualitative to quantitative integration method. This evaluationmethod is to set up a bridge between the qualitative and quantitative analysis, scientificcalculation methods abstract description of the system uncertainty, to reveal the nature ofthings and laws. It expert groups, data and a variety of information and computer combinedorganically combine the scientific theoretical knowledge and practical experience to play totheir respective advantages and the comprehensive positive effect. In this way, we will beeffective combination of qualitative and quantitative analysis, and eventually rose to thequantitative analysis of aspects; combination of the natural and social sciences; grasp themacro and micro analysis; combine more computer system together. Algorithm DHGF merger risk management, can make us a basis for quantitative analysis in the decision-making,thereby enhancing the scientific decision-making.DHGF integration algorithm is absorbed previous evaluation method has the advantageon the basis of scientific decision-making methods of improvement and innovation. First,from the analysis of the merger risk of performance form of the formation of the stage, cutand nature of different angles, and developed a hierarchical merger risk assessment indexsystem. Second, using the modified Delphi method discuss hierarchical optimization to beevaluated and statistical indicators, and the use of Sartre Professor reciprocal sc ale method torate, calculate the weight of the elements of the index layer. Again Evaluation assessed valuematrix to determine the class of its assessment of gray by gray is worth a fuzzy weight matrix.Finally, operate the fuzzy operation, to obtain the final results of evaluation. After theintroduction of appropriate assessment methods, the empirical analysis, test DHGF algorithmin the practical application of the effect.From both qualitative and quantitative aspects of M&A risk evaluation method made amore comprehensive introduction and article proposed the theory of the empirical analysis, anew evaluation method for Chinese enterprises M&A decision, although this algorithm isnot perfect, but it does effectively introduced into the theory of fuzzy mathematics mergerrisk management in this area, has a certain theoretical and practical significance.