Reserach On Financial Risk Management Of Reverse Cross-border M&A

With the rapid development of economy,transnational mergers and acquisitions of Chinese enterprises are becoming increasingly active,and the transaction volume of transnational mergers and acquisitions is increasing year by year.Since the 21 st century,the cross-border merger and acquisition activities of Chinese enterprises have entered a high tide,there are many successful overseas merger and acquisition cases,but some companies are not successful cross-border merger and acquisition activities,not accurately identify the financial risk and take appropriate measures to control is one of the important reasons leading to the failure of merger and acquisition.Enterprises will face various risks in cross-border M&A transactions,which run through the whole process before,during and after M&A.Inadequate risk prevention measures taken in any period may cause adverse effects,which will be comprehensively reflected in the financial risks of enterprises,leading to the deterioration of the financial situation of enterprises or the failure of M&A.In this paper,Will shares reverse transnational merger of Howe Technology as a case.Firstly,the research background and significance are introduced,the research methods,ideas and basic framework of this paper are proposed,and the related concepts and theories of the financial risk of transnational mergers and acquisitions of enterprises are sorted out.Secondly,it introduces the basic information of the case,including the merger parties,the merger process and the transaction motivation.Then the financial analysis method is used to analyze the financial risks faced by Will Stock reverse transnational merger before,during and after the merger.Then construct the financial risk evaluation index system of Will shares reverse transnational merger and acquisition of Howe Technology,and use the factor analysis method to comprehensively evaluate the financial risk of Will merger and acquisition.Finally,according to the research conclusions and results of this paper,combined with the characteristics of phased financial risks of reverse cross-border M&A,preventive measures are proposed for the financial risks faced by reverse cross-border M&A from the three stages before,during and after the M&A,providing theoretical and practical enlightenment for the financial risk management of reverse cross-border M&A.The results show that the secondary reverse transnational merger plan of Will Stock to Howe Technology is reasonable.The acquisition through direct or indirect combination of various means reduces the difficulty of obstacles encountered in the process of merger and acquisition and the risks of cash risk and debt repayment risk to a certain extent.The financial risk level of the reverse transnational merger of Will shares is "High Risk",especially pay attention to the three aspects of the main factors of debt paying ability,operation ability and profitability of the financial indicators;In the process of reverse cross-border M&A,enterprises need to have the awareness of dynamic risk control,take different measures to effectively manage the different stages of reverse cross-border M&A,sum up successful experience,and improve the success rate of reverse cross-border M&A.