The Research Of Financial Risks Management On GM Group Overseas M&A

With the changes of the global economy and the world situation, M & A has become one of the important means to centralize production and capital to achieve rapid expansion and resource optimization. Compared with other countries, China’s M & A activity began in the mid-eighties of the last century, in spite of a late start, the development was fast. Especially after entering the WTO, competition in China’s capital market and expansion of the capacity of enterprises have become increasingly fierce, making M & A activities grow rapidly in number. Although the number of mergers and acquisitions of Chinese enterprises tends to go up, the ratio of failure is very high, especially in overseas mergers and acquisitions cases, most of which are due to the overlook of or wrongly handling with financial risk. Therefore, analysis of mergers and acquisitions of financial risk, thus making the enterprises in the mergers and acquisitions able to avoid and control financial risks, is worth our study.It is for this purpose that the paper firstly reviews and summarizes the research results of financial risks associated with domestic and international mergers and acquisitions systematically, and then discusses financial risk of the merger in more details. After briefly introducing the theory, concepts and motivation of mergers and acquisitions, this paper begins to deepen the discussion of M & A financial risk management. Since this is the core of the theoretical basis of this paper, it not only introduces the concept of the acquisition of financial risk, but also discusses the target enterprise valuation risk, financing risk, payment types and causes of risk and integration risk in detail, and in the last part of the theory, the previous is concluded. The position of financial risk management in mergers and acquisitions is illustrated from five aspects. In the analysis of cases, this paper makes a brief introduction of the basic information on GM Group’s recent acquisition course, and based on GM Group’s previous acquisitions, especially of Weetabix of France and Yoplait of the United Kingdom, summarizes four studies on target business valuation risk, financing risk group occurred in M & A transactions, the payment risk and financial risk integration risks. With the method of theory with practical exposition used in the next section, the theoretical control approach and practical activities in the GM Group are introduced accordingly, control measures adopted, and this paper discusses how to control the management of the respective acquisitions of financial risk in M & A activity from four aspects, while the experience of mergers and acquisitions is summarized, pointing out that how GM Group can prevent these four financial risks in recent mergers and acquisitions of Israel’s largest grocer Fontenoy company and other relevant suggestions are provided. This paper aims to contribute to the development and improvement of researches in the field and to improve the success rate of mergers and acquisitions in our country.