Font Size: a A A

Study On Motivations Of Enterprise Merger & Acquisition And Precautions Against ITS Risks

Posted on:2003-03-14Degree:MasterType:Thesis
Country:ChinaCandidate:H ZhangFull Text:PDF
GTID:2156360065955332Subject:Business management
Abstract/Summary:PDF Full Text Request
Since the end of the 19dr century and the beginning of the 20 century,enterprise merger and acquisition (M&A) ail over the world has experienced five big waves. And in China,two such waves have already been experienced since the 1980's. What caused these large-scale M&A waves? This article holds that there are three types of motivations in M&A. Firstly,to maintain and develop advantages in competition. Secondly,to realize expansion with low cost. And thirdly,the wish to merge of managers under the agent system. Meantime,M&A will produce three kinds of effects as follows:(1) Effect of cooperation in management and realization of economy of scale,(2) economizing business expenses and relieving competitive pressure,(3) increasing operational benefits and optimizing enterprise development strcueay.Those three types of motivation and three kinds of effects have caused M&A wav vs all over the world. Through case study on M&A at home and abroad,we find riiat the probability of success exceeds that of Mure in terms of the results of M&A. M&A is double-edged sword with relatively high risk. Although scholars from home and abroad have made much study on M&A from different perspectives,there is a lack in systematic research on the risks of M&A. Therefore,based on the study on the mechanism of M&A. we focus on its risk & precautions in the research. Conclusion is drawn that there exit six sorts of risks in M&A,narr.eiy:(1) risk of lie agent system;(2) risk of M&A without sufficient planning preparation;(3) non-rational risk during the negotiation process;(4) overpaid risk in financial affairs;(5) risk of improper integration after mergers;(6) multiplex risk.Targeting at the above mentioned six sorts of risks in M&A,we propose relevant measure against the risks from the point of management science,i.e.,making analysis en the basis for M&A strategy decisions and politic evaluation over M&A plan,paying attention to evading risks in the course of negotiation and contract signing as well as bettering integration and coordination following mergers,etc.
Keywords/Search Tags:Enterprise Mergers & Acquisition, Motivation, Risk, Precaution Measures
PDF Full Text Request
Related items