Research On The Financial Risks Of Overseas M&A Of Private Enterprises

In recent years,China has strongly supported Chinese enterprises to "go global",especially under the background of the deepening of "One Belt And One Road" initiative,Chinese enterprises have carried out a series of overseas M&A activities to expand the international market,and the effect of overseas M&A has a far-reaching impact on the development of enterprises.As domestic private enterprises tend to stabilize in the domestic market,they gradually start to expand overseas investment,and the scale of investment keeps expanding.In 2016,they will replace state-owned enterprises as the main body of overseas mergers and acquisitions of domestic enterprises.In the process of global integration,domestic enterprises can acquire technology,expand market and other aspects through overseas M&A activities,but the problem of low success rate must be attached great importance by domestic M&A enterprises.In recent years,with the prevalence of unilateralism and the increasing influence of trade protectionism,private enterprises have to bear not only financial risks but also high legal risks in the process of overseas mergers and acquisitions,and the deterioration of the international political environment has also l ed to the intensification of their political risks.Therefore,strengthening the research and management of overseas MERGERS and acquisitions is of great significance for improving the risk prevention and management awareness of overseas acquirer enterprises,which can help private enterprises to improve the success rate of overseas mergers and acquisitions.Taking JS company’s merger and acquisition of TA Company in 2018 as an example,this paper firstly summarizes and analyzes relevant domestic and foreign literatures on M&A and overseas M&A.Secondly,based on the current situation and characteristics of the financial risks of overseas MERGERS and acquisitions of private enterprises in China,the paper makes a macro analysis to compare the differences between the financial risks of overseas mergers and acquisitions of private enterprises and state-owned enterprises.Then the JS company mergers and acquisitions TA case analysis,using the Z value criterion to identify the overall financial risk of M&A,and the financial ability indicators,through the analysis of company of JS company’s four major financial capacity index analysis,identify the valuation risk,finance risk in the process of mergers and acquisitions,debt repayment risk,operation risk,profitability,risk,and integration of risk,the risk behind the cause of the in-depth analysis,in view of the causes,puts forward the feasible risk prevention measures,hoping to bring our country private enterprise overseas M&A certain practical significance.Through case analysis,this paper argues that private enterprises should combine their own development strategy and industry development trend when choosing target enterprises,attach great importance to the possible risks in the process of overseas mergers and acquisitions,and take targeted risk control measures.Only by facing up to and preventing these risks,can the success rate of overseas M&A of China’s private enterprises be really improved,and can overseas M&A be fully played by private enterprises.