Research On Risk Management Of Cross Industry M & A Performance Commitment

In the capital market,reasonable merger and acquisition activities can bring certain enhanced benefits to enterprises.Through mergers and acquisitions and reorganizations between enterprises,the size of the acquirer’s enterprise can be improved,thereby improving economic performance and occupying a larger market share.Stimulated by the policies of state-owned enterprise reform and the promotion of mergers and reorganization of enterprises,the active level of corporate mergers and acquisitions and the scale of transactions have reached new heights.In order to protect the interests of the parties and small and medium shareholders of the merger and acquisition,reduce the premium risk,and encourage management,performance compensation agreements are increasingly used in merger and acquisition transactions.However,since the performance compensation system was proposed in 2008,it is still being continuously improved.It also brings new risks while preventing and controlling risks.Therefore,in the course of mergers and acquisitions,listed companies should take a rational view of the performance of the performance compensation system and actively carry out risk management.This thesis analyzes the performance commitment risk in the process of Xinri Hengli’s acquisition of Boya Stem Cells.In the analysis process,fuzzy comprehensive evaluation method,analytic hierarchy process and expert opinion method are mainly used.Firstly,the analytic hierarchy process is used to determine the weight of each factor,and then the importance of the risk is determined by the scoring of 100 experts in the industry.Then the fuzzy comprehensive judgment matrix and weights are used to calculate the risk degree of each factor,and the risks are integrated according to the analysis Sexual evaluation,and finally formulate an enterprise risk plan.Through the empirical analysis of the risk commitment performance of Xinri Hengli’s Merger and Acquisition of Boya Stem Cells,this thesis draws the following conclusions:(1)The fuzzy comprehensive evaluation method can better assess the risks of corporate mergers and acquisitions,and the factors affecting the financial risks of mergers and acquisitions are many and many Hierarchical and different evaluation models for M & A activities are different.In this case,it is difficult to achieve ordinary assessment methods by highlighting the importance of each factor and the hierarchical relationship between each factor.The fuzzy comprehensive evaluation method establishes a hierarchical model,decomposes and influences the influencing factors,and effectively integrates the subjective experience of the experts objectively,forming a more reliable evaluation conclusion.At the same time,the fuzzy comprehensive method for assessing the financial risks of cross-border mergers and acquisitions can not only understand the overall risk level of the enterprise across industries,but also evaluate the risk factors of its constituent indicators.This method can also help us understand the specific factors that cause the degree of risk.Not only can it provide data support for the merger decision before the merger,but it can also help the company better avoid and prevent financial risks during and after the merger.effect.(2)During the process of corporate mergers and acquisitions,there are significant risks before the performance commitment is signed,during performance,and after implementation.In the research of this thesis,the risks of the enterprises before the performance commitments are signed are the highest.Among them,the high valuation risk is in this merger and acquisition process.The negative effects of singularity cannot be underestimated.(3)While performance commitment provides a certain guarantee for cross-industry M&A,there are also certain risks,and the existence of these risks even affects the success of the whole cross-industry M&A.In the process of crossindustry MERGERS and acquisitions,the acquirer should not simply take performance commitment as a protection umbrella,but should strengthen the identification of performance commitment risks,and formulate corresponding countermeasures based on their own development practice to minimize performance commitment risks.