Research On M&A Risk Control Under The Mode Of "Listed Companies+PE"

With the vigorous development of the market economy,M&A activities in China's market continued to be active and showed a growing trend.According to PricewaterhouseCoopers' 2018 China M&A Market Review and 2019 Outlook,China,s 2018 M&A transaction amounted to approximately 678 billion yuan,an increase of 11%over the previous year.The overall M&A volume has been relatively stable in the past three years.Among them,private equity invesfment is very active,setting a new record of US$222 billion in 2018,reflecting the abundant market capital and meeting the high financing needs of the private equity industry.The continuous development of China's M&A transaction market has spawned many new M&A methods.Listed companies have joined forces with private equity investment institutions(hereinafter referred to as PE)to establish M&A funds.The way of joint M&A activities has gradually emerged in the market with its unique advantages.M&A funds are therefore favored by many listed companies.However,some listed companies have experienced a redemption crisis in their operations.The risk identification and control of M&A fund operations has become a major problem that listed companies must solve.In the operation process of the M&A fund,as long as there is a problem in one of the links,the M&A fund project will fail.At the same time,it will cause the listed company to waste manpower,capital,and even waste the resources of the entire market.Therefore,the listed company,s M&A fund risk identification and control plan before investment can promote the smooth progress of M&A activities,facilitate the integration brings economic benefits and market to both listed companies and PE.status.Starting from the review and summary of the literature,this paper tells about PE establishment M&A fund,and introduces the operation process of this type of M&A fund:screening PE institutions,raising funds,selecting target companies,investing in target companies,The M&A company was post-investment management and the acquisition was withdrawn.This paper cornbines cases to identify risks in all aspects of fund operations,and proposes countermeasures for each risk.From the perspective of listed companies,this paper analyzes the potential risks in the M&A activities of M&A funds.First,choose the appropriate PE institutions according to the purpose of M&A of listed companies,such as horizontal Under the M&A method.The listed company selects the appropriate value assessment method,selects appropriate merger and acquisition opportunities,and understands the risks,so as to lower the valuation risk of the listed company to the target company.