M & A Risk Study

Corporate merger and acquisition is an important means for an enterprise to enlarge its operation scale and increase its competitive strength. Merger and acquisition brings forth a series of influences on the company and the national economy as well. The merging activities are now in the fashion, but the truth proves a high rate of failure, and one of the most important factors is that the management level of the enterprise fails to truly understand the risks in the corporate merger and acquisition and did not take any effective protective actions. This academic paper analyzes the root cause of the risks in the corporate merger and acquisition from themotivation and process side respectively; at the meanwhile, it also educes some means of avoiding the risks in the corporate merger and acquisition. The risks in the corporate merger and acquisition refer to the possibilities that the corporate goal can not be reached as planned, and the negative impact to the normal business operation of the corporate. According to the logic sequence, the risks in the corporate merger and acquisition can be categorized as: the risks before the process of merger and acquisition, during the process of merger and acquisition and after the process of merger and acquisition. However, what is on earth the risks of merger and acquisition could be? This paper uses the mathematics tools to further analyze the risks of merger & acquisition.To keep the risks in the corporate merger and acquisition away, actually involves many aspects. This paper introduces some successful experience on how to avoid the risks of merger and acquisition based on two corporate cases, thus educes some effective measures for the reference of all corporate for later suggestions. This paper also intends to provide a consultation on how to identify and avoid the risks of merger and acquisition so as to promote the success of the corporate merger and acquisition and to help to develop the whole merger activities in China...