Financial Risk Control Of Gambling Behavior In Private Equity Investment

Private equity investment is a means of investment with high returns and high risks.Private equity investors and financiers restrict each other by signing agreements,and jointly deal with financial risks.In order to achieve win-win target performance,the cooperation formed is a gambling agreement.At present,Private equity betting agreement has been widely used in China.In the process of completing the betting agreement,both sides of investment and financing will have corresponding financial risks,including the risk of enterprise valuation and information asymmetry caused by investment activities identified by investors,as well as the risk of financing activities,business activities and moral hazards identified by financiers.How to identify all kinds of risks is an important issue that both sides of investment and financing must seriously negotiate in the gambling agreement.How to deal with and avoid financial risks also requires both sides of investment and financing to face and make decisions together.This paper makes a comprehensive analysis of the case of investment and gambling agreements between South Beauty and Dinghui,which leads to the consideration of both investors and financiers on the risk of gambling agreements.At the same time,it gives detailed countermeasures and solutions to the financial risks of the gambling agreement between the investors and the financiers.Combining with the failure and success cases of betting agreements in China,this paper integrates information asymmetry theory,principal-agent theory,option theory and risk control theory into practical cases,and focuses on the analysis.This paper analyses the financial risks of both investors and financiers in the process of gambling agreement in case enterprises.Combining risk mitigation,risk monitoring and risk avoidance control methods,it puts forward corresponding risk control measures for investinent enterprises and financing enterprises,expecting to effectively reduce their existing risk degree,so as to achieve the win-win goal of both investors and financiers.Through the analysis of the typical failure cases of the investment of South Beauty and Dinghui in the gambling agreement,the corresponding risk control measures are proposed for the investment side of South Beauty and the financing side of Dinghui respectively.