Research On The Choice Of Financing Methods Of Overseas M&A

Since the strategy of "going out" putting forward,it has improved the pace of our Chinese enterprise of foreign investment.Especially since 2003,China speed up the implementation of the strategy,more and more Chinese enterprises go abroad,in addition to the number of "going out" enterprises from less to more,the type of enterprises is becoming variable.As the world economy recovery difficultly and the nationwide FDI flow decreasing,according to the 2015 statistics bulletin of the foreign direct investment in China,issued by the ministry of commerce and other departments,China investment flow leap to the second place that surpass the scale attracting foreign investment over the same period;in the background of the direct investment outflows realize $1.47 trillion and 11.8% growth,the FDI reach a new record of $145.67 billion and 18.3% growth,China more than Japan become the second largest foreign investor in the word.As One Road One Road strategy to promote,FDI of Chinese enterprise is more convenient,endogenous dynamic of FDI enhanced,so the chance of FDI of China increase and be powerful.However,FDI of foreign of Chinese enterprises need strong financial support,relying on their own funds is not enough and very difficult to develop foreign investment.It has become an important factor affecting the development of China’s foreign direct investment,if the enterprises can solve the problem of investment funds through the outside financing.And how to choose in the process of m&a financing becomes an important problem in the field.In this paper,we summarizes the types and features of various kinds of financing ways firstly.Then we discusses the amount of financing,selection of corporate capital structure,financing tools,the way of payment and other factors by combing through m&a financing arrangement.By concerning these various factors,we can choose a best way to financing.In the practice of Guang Ming group buying Weetabix,we can conclude that in current international m&a,traditional way of financing cannot adapt to the current economic development.Pursuing the lowest capital cost,minimized financial risk,high benefit,Chinese enterprises should learn from Europe and US and other developed countries to design a suitable financing arrangement.And it will become enterprises’ weapons for m&a.Above all,when Chinese enterprises moving towards the international market abroad,at the same time,they should focus on financing innovation for the current financial environment of low cost,low risk and high benefit.