The Research On Financial Risk Of The Merger And Acquisition Of Baosteel And Wisco

In the 1990s,with the rapid development of the information science technology and economic globalization,the world set off the fifth M&A(merger and acquisition)wave characterized by "megamerger".M&A cases happened in this wave provide a great practice experience.M&A is a high-risk behavior,and financial activities exist in M&A process all the time,it will cause financial crisis even lead to bankruptcy as long as one of the parts goes wrong.This article first defines the concept of M&A and financial risk of M&A,and stating the types of the financial risk of M&A in order of the M&A process,listing a series of evaluation methods of the financial risk of M&A at the same time,providing the theory basis for the rest of this article.This article is doing the research on the M&A case between Baosteel and Wisco contraposing the time sequence of the M&A case between Baosteel and Wisco,you can analyze four kinds of financial risk of M&A according to disclosure of financial statements of both company,Overpriced M&A target、Equity payment risk、Growing debt risk and the risk of financial integration.Using analytic hierarchy process and fuzzy comprehensive evaluation method to evaluate the four kinds of risks,draw a conclusion that the risk of financial integration is top priority among the risk of M&A.Analyzing the cause of risk according to the types of financial risk and evaluation results.In the end this article presents relevant precautionary measures according to analyze before.You can fully understand the information of the target enterprise and combine pricing with various pricing methods to prevent the pricing risk,you can use mixed payment against payment risk,you can adjust liability structure against the risk of debt,you can first draw up the financial strategy then establish a unified financial management system,and organizing M&A teams to increase integration efficiency.