Case Analysis Of Panda Fireworks Cross-industry Merger Risk Based On Financial Flexibility

Along with our country economy enters the new normal,supply side structural reform under the background of transformation and upgrading of traditional enterprise demand increasingly intense,as the m&a market prosperity,cross-industry mergers and rapid development of the traditional enterprise with diversified business or business transformation as the target of cross-industry mergers and acquisitions become a trend,and reached its peak in 2015,the number of cross-industry mergers and acquisitions event in2015 alone as many as 2025 times,is the first year of cross-industry mergers and acquisitions.Both opportunities and challenges,however,the policy environment,the target enterprise itself and the characteristics of the industry such as mergers and acquisitions party factors,cross-industry undercurrent in the process of mergers and acquisitions,mergers and acquisitions fail frequently appear,this leads to the problem of cross-industry mergers and acquisitions and controversy,cross-industry mergers and acquisitions become issues of common concern to risk.In this regard,scholars at home and abroad have carried out research on the risk identification of mergers and acquisitions,and have summarized effective risk identification methods such as brainstorm method,scene analysis method,Delphi method,cost-benefit analysis method and financial leverage identification method.As the actual situation of each enterprise is different,it will face different types of risks in mergers and acquisitions,which leads to the fact that no scholars have proposed risk identification methods applicable to all mergers and acquisitions.Based on the traditional hot cross-industry mergers and acquisitions,film and television enterprises a cross-industry mergers and acquisitions,choose typical case analysis,evaluation and analysis of mergers and acquisitions of financial flexibility,to identify the risks in mergers and acquisitions and explore the factors that hinder the transformation and upgrading of traditional industries,provide Suggestions for traditional enterprise risk preventing cross-industry mergers and acquisitions,provide certain reference for identification of the risk of mergers and acquisitions.As an index to measure an enterprise’s ability to cope with future uncertainty,financial elasticity has not been widely concerned by scholars at home and abroad,but its importance cannot be ignored.As an enterprise investment activity,cross-industry merger and acquisition is closely related to financial elasticity.Having a good level of financial elasticity can ensure that the merger and acquisition party can respond calmly in the process of merger and acquisition and reduce the risk of merger and acquisition.Conversely,it increases the degree of risk.Therefore,this paper chooses to analyze the risks in cross-industry mergers and acquisitions based on the evaluation of the financial resilience of the merger and acquisition parties.This paper selects panda fireworks merger and acquisition huahai era,a typical case of traditional enterprises failed in cross-industry merger and acquisition,for in-depth analysis.In order to be able to a more comprehensive,intuitive evaluation panda fireworks financial flexibility,this paper introduces the factor analysis method,in reference to previous research results on the basis of the index evaluation system,financial flexibility and transverse contrast and from the same industry mergers and acquisitions in the 5 years before the longitudinal contrast two aspects to analysis and evaluation,so as to come to the conclusion that its financial flexibility is poorer.After finding out the cause of the poor financial elasticity of panda fireworks through factor analysis,combining with the specific merger process can accurately identify the risk in the failed merger case.This paper finds that,with the goal of seeking new profit growth points and improving financial conditions,panda fireworks blindly followed the m&a boom with poor financial flexibility,which led to the emergence of various m&a risks,and ultimately failed.Therefore,the risk of cross-industry merger and acquisition can be effectively prevented by accurately recognizing the company’s situation before merger and acquisition,maintaining good financial flexibility and seeking guidance from professional institutions.This paper summarizes the enlightenment of the case and puts forward some Suggestions on the case,which provides reference for the traditional enterprises to make cross-industry mergers and acquisitions.The innovation of this paper lies in the introduction of financial elasticity analysis and evaluation,from another perspective to analyze the risk of mergers and acquisitions;Taking the stage of merger and acquisition rather than the failure of integration as the research direction,this paper extends thetraditional research direction.