Financial risk identification and control of cross border merger and acquisition enterprises

Yuanyuan SUI, Adelina DUMITRESCU – PECULEA
2016 Audit Financiar  
Mergers and acquisitions (M&A) are basic channels for modern companies' growth. With globalization speeding up, multinational companies increasingly take on M&A activities to strengthen global market positions and raise competitiveness. In recent years, M&A activities have played an important role in Chinese companies. Financial risk is inherent to M&A processes in crossborder companies. Also, more than 50% of Chinese companies did not achieve their M&A goals. Therefore, recognizing and
more » ... gnizing and controlling financial risk is essential. This paper analyses the financial risk from different perspectives and then provides suggestions by analysing a typical M&A case: Bohai Leasing merger with Seaco Company. Complete due diligence and clear M&A strategies, combination of various financing instrument, strategic paying methods and finance integration are some ways for controlling and decreasing finance risk.
doi:10.20869/auditf/2016/144/1368 fatcat:2sd4gmnvpjfu3m5rp5eqr4xa5m