Research On Financial Risk Prevention Of Jifeng Company’s Overseas M&A

Under the new development pattern,China has successively introduced a number of policies.These policies actively encourage,standardize and guide domestic manufacturing listed companies or industry leaders to introduce international advanced technology through overseas M&A,and to improve the core competitiveness of domestic industry.In essence,overseas M&A is a financial investment activity for enterprises,and the risks arising from M&A will eventually be reflected in financial risks.Therefore,financial risks are the most direct manifestation of merger risks.Financial risk prevention is the focus of overseas M&A.Jifeng Company is a private listed company,mainly engaged in car parts and accessories.Affected by factors such as industry development trends,national policy encouragement,and changes in the competitive landscape,Jifeng Company implemented a strategic M&A to Grammer AG and became a global multinational business group.However,after the implementation of M&A,Jifeng’s overall financial situation showed a deteriorating trend and showed great instability.Profitability,solvency,asset liquidity and operating cash flow have all been significantly weakened,and the ability to resist risks has been significantly reduced,in addition to the improvement in asset turnover.It can be seen that overseas M&A brings greater financial risks to Jifeng Company.The thesis uses a combination of Z-value model analysis,factor analysis,and peer comparison to deeply analyze the causes of financial risks in Jifeng’s M&A case.By analyzing the impact of non-financial factors on financial performance and the direct impact of financial factors,it is proposed that Jifeng’s lack of mature long-term strategic planning has led to insufficient risk estimates for the acquisition of Grammer AG.Factors such as high value pricing,unreasonable payment methods and financing methods,directly lead to greater financial risks after M&A.The research of the thesis proposes that if Jifeng Company is to successfully integrate this merger case and prevent financial risks in subsequent overseas M&A,it should start from formulating an overall risk prevention plan,such as formulating long-term strategic planning,improving corporate governance systems,establishing financial risk prevention and control systems,and building financial evaluation and early warning systems.At the same time,the thesis combines the preparation,implementation,and integration stages of overseas M&A,and proposes to formulate specific countermeasures to prevent financial risks.Specifically,it contains comprehensive due diligence,reasonable evaluation of the value of the target,careful selection of payment methods and financing methods,and comprehensive integration Financial management and improvement of financing structure.