Research On Financial Riskaof Jinyi Culture's Continuous Mergers And Acquisitions

With the continuous opening of China's capital market and the rapid development of market economy,more and more enterprises choose M & A as an external expansion way to expand the scale of enterprises,optimize the allocation of resources,and improve their competitive advantage through the realization of strategic transformation.In recent years,the number and frequency of M & A transactions of Listed Companies in China have been increasing,and the continuity is more prominent.However,the continuous M & A has a high demand on the capital and management level of M & A companies,and a little carelessness will lead to financial risks.Since the beginning of M & A in 2015,Jinyi culture has ignored the identification and evaluation of its financial situation,resulting in the rupture of its capital chain in 2017 and the sharp decline of its net profit.Finally,it has to sell its shell to haijinke group in 2018.This paper takes the financial risk of continuous merger and acquisition of Jinyi culture as the target case,combines the characteristics of gold and jewelry industry enterprises,constructs a reasonable financial index system,and uses the principal component analysis method to evaluate the financial level of Jinyi culture before and after the continuous merger and acquisition from the perspective of horizontal analysis and vertical comparison.In the vertical analysis,the financial data of Jinyi culture in 2014-2018 is selected,and the principal component analysis method is used to comprehensively evaluate the financial situation of Jinyi culture before and after the continuous merger and acquisition.The score is used as the standard to measure the financial level,and the change of its financial risk is analyzed by observing the score changes before and after the merger and acquisition of Jinyi culture.In the horizontal comparison,nine companies in the same industry are compared The financial level of the company in 2014-2017 was evaluated,and the financial level of the company was ranked according to the score.The financial risk of the company was reflected from the change of the ranking of kingee culture in the sample enterprises.Horizontal comparison helps to eliminate the impact of external market environment changes on the financial level,making it more objective to use the principal component analysis method to evaluate the financial risk of continuous M & A of Jinyi culture.The research results show that due to the unfavorable integration,the continuous M & A of kingee culture in 2015-2017 did not improve its financial situation,but after thecompletion of the second stage of M & A,its financial situation has been deteriorating,andits ranking has been declining compared with the same industry.Based on the research conclusion,this paper puts forward the corresponding suggestions: first,enterprises should combine their own development strategy to avoid blind and continuous M & A;second,establish financial early warning system to strengthen risk prevention;finally,we should pay attention to the integration after M & A to improve the profitability.