Risk Management Of Corporate Mergers And Acquisitions And The Subsequent Integration

With the increasing globalization of economy and the capital market, tremendous business opportunities as well as the uncertainty of the economic environment were given rise to. Especially at the beginning of the 21^st century, several international groups went bankrupt for accounting scandals and the failure of internal control. We find the internal control can not solve the problem of dishonesty at the management level. Thus risk and risk management becomes the focus and keystone of enterprise management along with the development of market economy. Risk management of an enterprise underwent five stages roughly, namely, internal supervision, internal control system, the structure of internal control, the framework of internal control, and the framework of risk management of enterprises. Risk management which includes internal control fuses with risk management and thus they construct a new concept of management and control and a more powerful management tool.The excellent performance of a company comes mainly from its daily business and the external-oriented equity investment. Merger and acquisition are the frequently used methods to for an enterprise to expand. Whether the merger and acquisition are successful or not becomes one of the key factors that affect its performance.Though the trend of merger and acquisition is going upwards, the rate of failure cases has exceeded 50%. This phenomenon made the author reflect upon the causes of merger and acquisition and attempt to find a simple but practical tool for risk appraisal and then try to give a quantative assessment of the target enterprise so as to increase the possibility of success in this practice.This thesis offers a tentative research on risk management with focuses on the relevant key factors within the framework of risk management—recognizing risk, risk appraisal, and dealing with risk.Methodologically speaking, this thesis combines the qualitative and quantative research under the principle of "quantative method first". The author designs a simple but practical table of risk appraisal in merger and acquisition (scoring card for balancing in merger and acquisition). The thesis chooses the acquisition of Jiangxi Hero by Bright Diaries as the sample to study. Based on this test, some improvement is given to the design of the table and finally an evaluation is given to the sample case according to it.