Study On The Control Of Financial Risk In Mergers And Acquisitions Of China’s Coal Enterprises

As an important part of the energy system, coal has been playing a great role in the economy and the society of our country. Meanwhile, coal, scarce and nonrenewable, is the resource security of the sustainable development strategy in our country. At present, the amount of coal enterprises is numerous, the capacity is scattered, and the concentration ratio is low, what’s more, the undesirable competition is still there. However, in 2012, the situation of coal market has suffered a sudden and reversal change. The coal product is unsalable, the inventory is so high and the price declines so fast. In current, coal enterprise M&A has become the direction of the industry in China. There are so many risks in the M&A process, the financial risk is the most comprehensive one and has become the key factor that determines whether the M&A can success. Writing on “The study on financial risk control in coal enterprise M&A in China”, I’m trying to build up the control system of financial risk in M&A.Methods in the article mainly include literature research, the flow chart method and fuzzy comprehensive evaluation method. In the first place, with literature research, we can understand the present research status both at home and abroad, and learn the related theory about M&A. Secondly, I have tried to build the M&A financial risk control system, which includes the main process such as the identifying, measuring and controlling. On this basis, the paper states the present situation of the industry of China as well as the basic condition of coal enterprise M&A. Meanwhile, I have analyzed the present environment of M&A, and summarized the main form of M&A and the particularity of the merger process. I have built the evaluation system and use the fuzzy comprehensive evaluation method to evaluate the risk. Finally, the paper puts forward some measures to how to guard against the financial risk in M&A.