Research On The Risk Of Continuous M&A Of Lepu Medical

With the rapid development of China’s economy,more and more enterprises choose M &A to expand.In China’s capital market,M & A has become a common phenomenon.In order to expand the scale of enterprises faster and realize the leapfrog development of enterprises,the frequency of M & A is speeding up,and the interval is becoming shorter and more frequent and continuous.According to the data report of China’s enterprise M & a market in2018,there have been 100000 M & A events in China,and the amount of M & A transactions has reached more than $800 billion,and more than 60% of enterprises have conducted more than three M & A activities every year on average.However,the failure rate of M & A is as high as 80%.The high failure rate shows that M & A is a high-risk activity,and the frequency of M & A is higher than that of single M & A,the required capital scale is larger than that of single M & A,the integration time is shorter than that of single M & A,and the risk of continuous M & A is higher than that of single M & A.therefore,it is very important to study the risk of continuous M & A and how to manage the risk.This paper mainly through the way of case analysis,first of all,briefly introduces the general situation of Lepu medical and its industry environment,the continuous M & a strategy of Lepu medical,selects the M & A events of Lepu medical from 2009 to 2018,and divides the M & a process of Lepu medical into three stages: initial M & a stage,rapid expansion stage and M & a slowdown stage After the analysis,it is found that the long-term performance declines most obviously in the period of frequent M & A,and the performance is the worst in the year with the largest number of M & A,which verifies the high risk of continuous M & A.Secondly,using the theory of risk management,the continuous M & A activities are divided into three stages for risk identification.In the continuous M & a decision-making stage,the decision-making risk mainly includes strategic risk and institutional risk;in the continuous M & a transaction stage,the author analyzes the payment method and valuation method of Lepu medical M & A case,and finds that the risk of continuous M & a mainly includes cash expenditure Payment risk,valuation risk and goodwill impairment risk;in the integration stage of continuous M & A,it mainly includes business integration risk,management integration risk,human resource integration risk and corporate culture integration risk.Then,after the risk identification,the importance of each risk is scored by the way of questionnaire and expert scoring,and then the weight of each risk in continuous M & A is calculated by using fuzzy hierarchy risk method.Through the results of risk assessment,we find that the key risk points of continuous M & A are improper strategy,improper payment method,over optimistic expectation of future performance of the merged enterprises,and poor organization management and business integration after M & A.Finally,according to the theory of risk transmission,risk management of key issues in each stage of Lepu medical continuous M & A is carried out to reduce the risk of continuous M & A.At the same time,it is expected that through the case study,it can provide reference for enterprises in the same industry or continuous M & A enterprises to do a good job in risk management and improve the efficiency of M & A.