Research On Financial Risk Analysis And Control Of Merger And Acquisition Between Fengfan And Q Group

With the ec onomic globalization and the promo tion of e conomic system reform in China,merger and acquisition(M&A)activities among enterprises in various industries has become an inevitable trend.The last 5 years,b oth the number and value of mergers and acquisitions in the domestic market have already s hown a steady rising trend.But ther e is still a large gap between home and abroad in the financial theory and th e practice of m erger and acquisition,which could cause financial risk and have a serious im pact on the merger and acquisition activities of domestic enterprises.Any kind of merger and acquisition exists risks,such as decision-making risks before M&A,implement risks during M&A,financial risks,etc.,especially the financial risks,which plays an important role in the success of m erger and acquisition.No one could avoid the financial risks generated in M&A.The uncertainty of financial risks could directly lead to the failure of M&A.And can also bring hidden trouble to th e development of the enterprises and cause a significant impact in the future.So,accurate and in-depth analys is of the financial risks o f enterprises’ merger and acquisition activities plays an im portant guiding role in the proce ss of M&A,a s well as s trict measurement of the financial risks,timely prevention and control of financial risks.So,accurate and in-depth analysis of the f inancial risks of enterprises’ merger and acquisition activities,strict measurement of the financial risks,as well as timely prevention and control of financial risks are playing an important guiding role in the process of M&AIn this paper,qualitative research and quantitative research are used to analyze the financial risks of M&A between Fengfan and Q group.Firstly,the res earch background,purpose and significance of the research are discussed,and the research status at home and abroad is sorted out,and the connotation and types of financial risk of merger and acquisition are discussed by qualitative research method.There are four main types of financial risks of M&A: financing risk,payment risk,pricing risk,and financial integration risk of both parties after M&A.Secondly,this article lists the detail information of Fengfan and Q group,simply explains the industria l status,and m akes an analysis on the pricing,financing,paym ent risk and the financial integration after M&A.Thirdly,select all kinds of factors index that could affect each financial risk according to the specific situation of M&A between Fengfan and Q Group,and establish the risk evaluation index system.The fuzzy comprehensive evaluation of the financial risk of Fengfan was carried out by using analytic hierarchy process and fuzzy comprehensive ev aluation method.Finally,the article gives corresponding prevention and control m easures concerning the financial risks in the m erger and acquisition between Fengfan and Q Group.The research results show that there are four main financial risks during the M&A: the first is the risk of overpricing the target enterprise;Second,the risk of financing cost and financing structure;Third,the risk of cash flow caused by m erger and acquisition;Fourth,the merger and acquisition financial integration ris k.During the four m ain financial risks,the pricing risk a nd the risk of financial integration have more influence on M&A,and the others show relatively little impact.In general,the financial risk control of merger and acquisition by Fengfan is relatively low.