Study On The Control And Control Of Financial Risks Of L Group's Cross-border M Acquisition

In the context of global economic integration,Chinese enterprises want to further expand overseas markets,expand the scale and improve the core competitiveness of enterprises.Cross-border M&A is a very effective way.Because target enterprises generally have relatively mature and abundant resources in host countries,they will have many advantages compared to setting up new enterprises in foreign countries.Overall,overseas mergers and acquisitions by Chinese companies are on the rise.As of October 2017,despite the 40%drop in the total amount of Chinese M&A over the same period,the transaction amount reached 86.3 billion U.S.dollars,which is still at a high level compared with the previous years.Moreover,Thomson Reuters' "One Belt and One Road" policy boosted the process of cross-border mergers and acquisitions in our country.Although the total cross-border M&A of Chinese enterprises dropped by 37%in 2017,the transaction volume of M&A along the "Belt and a Road" reached 46.1 billion U.S.dollars,More than 30.5 billion in 2016.Despite the increasing scale of cross-border M&A,the success rate of mergers and acquisitions is relatively low at around 30%because multinational mergers and acquisitions usually involve two or two countries and their legal systems and accounting systems will certainly differ.As a result,Trigger a series of financial risks.The reason is because it can not effectively identify the financial risks in the process of cross-border M&A,and even if it is identified,effective control measures may not be formulated.Therefore,in the wave of cross-border M&A of Chinese enterprises,we must correctly identify the risks,effectively avoid the risks and formulate reasonable and effective risk control measures.In this paper,the case of L Group M Company is taken as an example,because L Group is an outstanding national enterprise in our country.This acquisition also has the characteristics of M&A of Chinese enterprises and is representative.And L Group had previously had experience of cross-border mergers and acquisitions,known as the "swallow as elephant"mergers and acquisitions,but the merger did not continue the last glory,which further proof of the complexity of the risk of cross-border M&A.This paper analyzes the financial risk control measures in the process of mergers and acquisitions of L Group from the phases of M&A preparation,M&A and financial integration of M&A,through the use of literature research,theoretical analysis,case combination and data analysis,The existing risks and risks of the Group have not been subject to risk management and control.Finally,it summarizes the suggestions on the financial risk control measures adopted by the L Group in the merger of M companies and analyzes the advantages and disadvantages of its financial risk management and control.Where to carry forward to learn more,inadequate to be improved.This paper summarizes the experience of financial risk management and control through studying the financial risk control of the cross-border mergers and acquisitions of Group L,and can draw lessons from the follow-up of cross-border mergers and acquisitions of other companies.At the same time,through the study of this article,I hope that the decision-makers of enterprises should pay attention to the control and prevention of financial risks in the process of cross-border mergers and acquisitions and pay attention to the analysis and research of financial risks.Finally,to realize the process of opening up overseas markets for our nationality enterprises,the scale is increasing and the success rate of mergers and acquisitions continues to increase.