Risk Analysis Of The Merger And Acquisition Of Longxin Technology From The Perspective Of Performance Commitment

companies tend to choose performance pledge agreement to protect their own interests,but is associated with performance promise "high value,high commitment,high risk" of common phenomenon,the performance pledge system gradually exposed its shortcomings,and even became the enterprise operating earnings management incentives,It’s detached from its own meaning.It is worth thinking about how to identify the hidden risks and effectively avoid and manage them when listed companies make use of performance commitment.This article selects 2018 "performance promises BaoLei" lead to the failure of mergers and acquisitions company Connie typical electromechanical as a case study,from "the shoe’s ability" to "execute" results point of view,promised to set up performance pledge risk can be divided into performance,performance pledge mid-term and performance commitments will expire after three hours,and combining the segmented identification method to construct performance commitment risk analysis framework.performance commitment performance performance risk,risk after the expiration of performance commitment risk prevention measures and other aspects.In describing Connie electromechanical and Long Xin technology on both sides of the situation and after m&a process,such as risk analysis framework,and commitment to the performance of each node of the risk analysis,commitment to the performance of the risk that the various periods of quantification.First,when the performance commitment was set up,there was a situation of excessive confidence in the management of Coney Mechanical and Electrical,and negligence of due diligence.The single evaluation method of asset appraisal agency caused the risk of overvaluation;However,the high performance commitment set up in the preparation of performance commitment provisions foreshadows the implementation of subsequent performance commitment risks.Second,in the implementation of performance commitments,the integration of KONY Mechanical and Longxin Technology after the merger did not achieve the expected effect,the ability of various indicators was weakened.Third,after the performance commitment period,the test of event study method proved that the market decline caused by the risk of shareholder violations,resulting in the deterioration of performance and the provision of large amount of goodwill impairment,led to the decrease of the market value of Cony Mechanical and Electrical,and finally fell into financial difficulties.In response to the risks obtained from the above analysis,this paper puts forward corresponding suggestions respectively,such as rationally formulating performance commitment terms,strictly controlling the quality of intermediary agencies,integrating multiple valuation methods for valuation,and hiring independent financial consultants...