Research On The Risks Of Overseas Mergers And Acquisitions Of Chinese Auto Companies

The fifth wave of global mergers and acquisitions has made enterprise’s development enter a new stage, and our enterprises also follow the trend to a new direction. The various walks of life actively response to the government’s call of "go out" strategy, making carefully preparation and taking opportunities, to behave very excellent in the international M&A market. But at the same time, the risk of overseas mergers and acquisitions also follow behind.First, Background and aimsThe outbreak of the financial crisis in2008, made the economic environment in Europe and the United States and other developed countries become bad. Affected by the environment, the value of some excellent enterprise declines rapidly. Our country’s economic situation is contrary. China’s GDP has maintained steady growth in the recent20years, foreign exchange reserves hit a high record, and the life quality has a huge improvement. All of these provide favorable conditions for Chinese enterprises overseas mergers and acquisitions. Since2008, China’s auto industry emerges from the world market of mergers and acquisitions, to be reckoned a very important force in the field of overseas mergers and acquisitions. But due to the lack of experiences in our country automobile enterprise and the weakness of risk consciousness, we encountered many problems and risks in overseas mergers and acquisitions. This article is based on the background to study the risk of overseas mergers and acquisitions of China’s automobile industry. Research purposes as follows:Firstly, this article is to explore the cause of automobile industry overseas M&A risk and its specific performance. It Analyzes and summarizes the present situation of the automobile industry in our country overseas mergers and acquisitions motivation and M&A target selection.Secondly, with the actual situation of typical case analysis of the main risks faced by overseas M&A, it discusses our country automobile enterprises in overseas mergers and acquisitions of the main risks.Second, the main content of this thesisThis article is taken the risk of overseas mergers and acquisitions as the theme, and combined with the feature of the auto industry, so as to conduct a research in the overseas M&A risk of auto industry in China. The main content of this article is as follows:Chapter one is introduction. It introduced in detail about the research background and purpose, research thought and framework, obtained the research necessity of our country automobile industry overseas M&A risk problem.Chapter two is literature review. It introduced motivation of M&A, target selection of M&A, risk identification and prevention of M&A, combing existing research content to make a summary and induction.Chapter three is industry background. This chapter begins from the overseas M&A history of automobile industry in our country, making a comprehensive introduction of the current situation of the development of Chinese automobile industry and the problem, the implementation of internal motivation and external conditions of overseas M&A, the particularity of acquisition targets, to support for the following theoretical analysis as industry background.Chapter four is theoretical analysis. The theory analysis part introduced the causes of overseas M&A risk process, and then the overseas M&A risk is divided into three categories of risk, and made a detailed explanation to each kind of risk in this paper.Chapter five is case analysis. Combining with theory, especially the two cases that embody the integration risk and financial risk, it made an analysis summary.Chapter six is suggestion to risk. Finally on the basis of the above, this paper puts forward some suggestions to the risk prevention of overseas M&A.Third, main contribution and deficiencyThe author hopes that by combining the related theory and case study, it can explore risk faced by domestic automobile enterprises overseas in mergers and acquisitions to improve the success rate of merger and acquisition in the fierce international M&A market, especially the transaction after the completion of the integration. So as to provide some reference to in automotive industry and other industries fields.Firstly, this article is based on the background of auto industry to study the problems of the overseas M&A risks. I think that the generation of risk is closely related to the auto industry itself. On issues from the present situation of the auto industry, to the overseas M&A motivation, again to choose the target in the early stage of the merger process analysis, it concluded the auto industry overseas M&A risk reasons. The target selection is the direct cause of the risk, present situation of industry is the primary cause of risk. On this basis, I divided these risk of failure factors into environment, integration and financial risk. Secondly, I choose two typical cases to study. From case analysis we can find enlightenment of China’s automobile enterprises in stepped out, integration risk and financial risk problem is very obvious. It must need to be considered. The purpose is mainly to help others at the same time of go out to better identify risk and realize the synergy of M&A. We do analysis combined with case study to obtain risk aversion suggestions.Due to the limitation of my writing level and collecting information, case analysis and the suggestions may not be deep enough. These questions still need further research.