Research On The Choice And Performance Of Private Enterprises' Cross-border M &a Financing Methods

With the continuous development of the domestic economy,more and more companies have begun to "go out",and the proposal of the "Belt and Road" initiative has set off a wave of cross-border mergers and acquisitions of Chinese companies.2016 was a magnificent year for China's multinational mergers and acquisitions,and also a glorious year for private enterprises,because the number of cross-border mergers and acquisitions completed by private enterprises exceeded China's state-owned enterprises for the first time in both quantity and amount.On the one hand,cross-border mergers and acquisitions can help private companies achieve synergy in overseas markets or advanced technology,improve company performance,and become bigger and stronger.On the other hand,China's private enterprises have fewer financing opportunities in the securities market,and commercial banks and investment banks have fewer M & A financing services.Therefore,their M & A financing basically depends on their own funds.The right timing for cross-border M & A is often fleeting.According to Mc Kinsey's report,13% of uncompleted cross-border M & A transactions are due to inappropriate financing methods.Therefore,in the face of high-quality cross-border M & A opportunities,private enterprises first need to review the situation and adopt appropriate financing methods to quickly and effectively ensure that financing is in place.However,due to the huge scale of cross-border M & A financing and its far-reaching impact,its financing method decisions will directly change the company ' s capital structure,affect the company's overall weighted capital cost,and thus affect the company's value.Therefore,private enterprises' cross-border M & A financing method is a subject worthy of our in-depth study.According to financing theory,various financing methods have their own characteristics,so private enterprises need to choose the optimal financing method and structure according to their own financial situation and development strategy.Based on the existing research results of scholars at home and abroad,this paper summarizes the factorsthat affect M & A financing,and selects the case of the acquisition of Lexmark in the United States by the private enterprise with the reputation of "model transaction" in 2016.The choice and impact of financing methods for mergers and acquisitions.First,from the company's own internal perspective,analyze the five aspects of its shareholding structure,capital structure,financing costs,financial status and payment methods on the choice of financing methods for Ninestar's cross-border mergers and acquisitions.Secondly,from the external perspective of the company,analyze the impact of the M & A consideration payment method and the investment needs of PE investors and syndicated financing strategic alliances on the choice of M & A financing methods.Third,analyze the adjustment and selection process of Ninestar financing methods.Ninestar chose to use debt financing for financing,the main reason is that: Ninestar's financial situation before the merger is good,debt financing is conducive to the improvement of corporate value;compared with equity financing,debt financing takes less time and can meet mergers and acquisitions Payment time limit requirements;Ninestar's equity concentration is high,and debt financing does not need to worry about diluting corporate control,while also reducing financing costs.Finally,through EVA performance analysis,it is concluded that after completing the merger and acquisition,Ninestar achieves the optimal capital structure and maximizes the enterprise value.In general,the acquisition of Lexmark in the United States by Ninestar is a successful overseas merger and acquisition of Chinese private enterprises,and its financing method is a positive exploration.Through the research of this paper,the following three enlightenments are also drawn:(1)Pay attention to the internal capital market and expand financing channels.(2)Diversified financing and innovative use of financial instruments.(3)Form a financing strategic alliance and form a multi-agent joint M & A.The enlightenment obtained in this paper has a certain reference value for China's future private enterprises to make cross-border acquisitions.