Research On Performance Commitment Risk From The Perspective Of Hierarchical Holographic Modeling

At present,China is continuing to speed up the construction of capital market,the number of enterprise mergers and acquisitions is increasing day by day,performance commitment,as a new M &a contract system,has gradually come into the public view,and the new risks it brings are also gradually emerging.The continuous phenomenon that the performance commitment can not be realized when it expires will not only directly make the acquirer bear huge losses,but also attack the market’s confidence in the performance commitment system and eventually hinder the healthy development of China’s M &a market.Therefore,it is of great significance to study the causes of M &a performance commitment risks and how to prevent or reduce these risks,so as to make M &a performance commitment a reliable choice for M &A,so as to promote the good development of China’s capital market and protect the interests of M &A parties and small and medium-sized investors.This case mainly focuses on the case of Jinguan’s merger and acquisition of Liaoyuan Hongtu.The first chapter introduces the research background,research framework and innovation;The second chapter analyzes and summarizes the existing literature at home and abroad in theory,mainly including three aspects: the motivation,risk types and risk prevention and control of M &a performance commitment;The third chapter applies hierarchical holographic modeling(HHM)to the risk identification of performance commitment,forming a system of risk identification of performance commitment.HHM is a risk identification method that identifies the risks in the process of enterprise behavior through hierarchical and systematic thinking mode,and displays the identified risks in the form of tree diagram or flow chart.It has the advantages of comprehensive,systematic and easy to understand;The fourth chapter is a brief description of the process of Jinguan’s merger and acquisition of Liaoyuan Hongtu;The fifth and sixth chapters are the key chapters.This case selects the recent classic case of Jinguan’s merger and acquisition of Liaoyuan Hongtu,uses HHM modeling to sort out the types and causes of performance commitment risk in the case,and puts forward corresponding risk prevention and control suggestions;The seventh chapter is the research conclusion and Prospect of this case.Through the analysis,it is found that the main reasons for the risk in the performance commitment process of Jinguan’s M &A of Liaoyuan Hongtu are the improper selection of M &a valuation methods,the inaccurate prediction of the future performance of the target enterprise,the high and single performance evaluation index,the failure to achieve synergy,the cash out departure of large shareholders and the failure to realize performance compensation.Combined with the cases in this ca,provide corresponding risk prevention and control measures for subsequent M &A parties: first,M &A parties should carefully choose M &a valuation methods and pay attention to the impact of external risks of the target enterprise on valuation;Second,the acquirer also needs to strengthen the control and business integration of the target enterprise,and improve the incentive and supervision mechanism of the management of the target enterprise;Third,the setting of performance objectives should consider the introduction of non-financial indicators and be related to the industry average;Fourth,the content of performance commitment compensation terms should be clear and clear,and recover losses as much as possible.