The Research On Identification And Control Of Financial Risk About Overseas Mergers And Acquisitions In China’s Food Enterprises

It isn’t a fresh topic that Chinese food giants are moving abroad in recent years. China’s large food companies have established international development strategy, and the overseas mergers and acquisitions will be more and more in the coming years. However, the results of overseas M&A of food enterprises are not satisfactory. For example, from2010to2012, Bright Food Group has tried eight overseas mergers and acquisitions at an immense cost. We can see our food companies need to carry out overseas mergers and acquisitions in the future, but at the same time they encounter many resistance factors. Possible reasons include the macro environment factors and their own factors, like political, legal, financial, cultural and other aspects. But there is no doubt that those factors, like the financing difficulty, the background, the Integration and trust crisis are causing huge financial risk. And those financial risks occupy a very important position in the enterprise risk. It can be seen that the study of financial risk in food enterprises overseas M&A is very necessary. Therefore, this article focuses on the China’s food enterprises to study the overseas M&A financial risk identification and control.This article is divided into seven parts, and the main content of each part is as follows:The first part is the background of the study, pointing out the background and research method.The second part is a literature review, including research present situation of identification and control of financial risk on overseas mergers and acquisitions, and evaluates the progress of the study.The third part is the theoretical basis. Overseas M&A financial risk, the research object is defined in this part, and the overseas M&A financial risk identification theory and control theory are summarized.The fourth part describes the basic situation of China’s food enterprises overseas M&A in the first place, including motivation and characteristics of China’s food enterprises overseas mergers and acquisitions. Then it carries out the direct and indirect factors of financial risk in M&A preparation, implementation and integration stage, so as to identify the financial risks in China’s food enterprises o overseas M&A.The fifth part improves some countermeasures on how to helply\controlling the financial risk of the food enterprises in M&A each stage, to prevent and manage the financial risks in China’s food enterprises overseas M&A, to improve China’s food enterprises overseas acquisition ability, and to enhance its international competitiveness.The sixth part selects a specific case-Bright Food Group buys The Weetabix Food Company. After analyzing the risk identification and control in the case, we evaluate the control effect and draw inspiration, integrating theory with case well proves the validity and applicability of the research results.The seventh part is the research conclusion.Main contribution of this article is to focuses on the overseas M&A financial risk of China’s food enterprises, comprehensively analyzing the related financial risks to overseas M&A. and putting forward corresponding measures and methods of risk control. Then it uses a relatively new case to analyze overseas mergers and acquisitions in China’s food enterprises systematically and globally. It can provides a reference for future overseas mergers and acquisitions of China’s food enterprises. But because of my limitations in theories and experiences, this article is in the general sense theory to study the financial risk in food enterprises overseas M&A, but lack of empirical research, which are the shortcomings of this article.