On This Stage Of Merger & Acquisition Risk And Its Prevention

The Merger and Acquisition (M&A), Currently the most active way of alteration and transaction, in enterprise's property rights, means the extension of capital in a short time for enterprises and that of risks simultaneously.As far as its essence is concerned, the M&A is the property rights deals involving many respects in a society such factors as polities, economics, laws, culture, etc. Therefore, it's full of risks. There are many internal and external cases sustaining losses by failure of the M&A, such common risks as information risks, business risks, financial risks, anti-purchase risks, technique risks, scale-extension risks, law risks, culture risks, etc. The M&A in current china, relatively speaking, is of much risks awing to factors such as political-structure and capital market-inefficiency, and the very late starting of our capital operation.It's necessary to bring to light, analyze, and keep a lookout the possible various risks considering the safety in capital conducting.This article focuses on the analyses to the special political-structure risks, capital market-inefficiency risks, and social risks in M&A of enterprises in our country. I think that main reasons to cause the political-structure risks are the unclear property-rights and too-much interference by government, and that main reasons to cause market-inefficiency risks are the slow development of capital market and the short-coming of capital market system. Some protecting measures I raised are to deepen the reform to the property rights system, standard the property rights dealings. The state should change its function's reduce too much interference to enterprises, play the exemplary role of guiding coordinating, serving, safeguarding, create and perfect, its law environment for M&A. By the development and perfection of the capital market, we should keep a better capital market system, focus on cultivating the Bank of Investment, standard the intermediary organizations. Also I raised my points of view on the appropriation for M&A, analyses feasibility of M&A, effect on reform and reevaluation and orientation to the enterpriser.At last, I think that, with the economic development in China, transnational M&A is a short cut for our enterprises to go abroad. So, it's very necessary to pay special attention to the risks and supervision of the transnational M&A, and to take preventive measures.