Research On XK's Light Asset Merger And Acquisition Risk And Prevention Strategy

Under the background of China's economic structure transformation in recent years,some traditional industries in China have poor performance and are in a state of loss all the year round.Therefore,it is an inevitable trend to transform and upgrade traditional industries.On the contrary,entertainment consumption and other industries supported by national policies and accompanied by the continuous improvement of relevant laws and the upgrading of the consumer market began to be subject to a lot of capital competition in the capital market.Among them,cultural and media enterprises are also making continuous efforts to obtain financial support through mergers and acquisitions to expand market space.At present,China's cultural resources are in the integration stage.With the increase of the frequency of mergers and acquisitions in cultural industries,the prevalence of mergers and acquisitions in cultural industries also reflects the characteristics that industrial mergers and acquisitions tend to be asset-light.In addition,cross-border mergers and acquisitions have gradually broken the boundaries between regions and industries,and some large industrial groups of comprehensive nature are also gradually formed.But at the same time,crossing the boundary will make the strategy formulation,the process of negotiation and the later integration of many difficulties.Can asset-light mergers and acquisitions really further improve corporate performance?Based on the problem as a starting point,continue to track the XK company merger and acquisition activity,focus on the track of the enterprise trans-regional and cross-industry mergers and acquisitions,and more deeply analyzed the characteristic of the mergers and acquisitions,m&a motivation for the further study,comprehensive evaluation of the m&a performance,hoping to better guide the traditional industry mergers and acquisitions cases,further reduce the risk of mergers and acquisitions.There are many forms of cross-border mergers and acquisitions,among which the most common forms are mainly two,one is cross-region,the other is cross-industry.Each cross-border form has different characteristics and motivations,which are the maininfluencing factors of m&a performance evaluation.Generally,there are two major reasons for cross-industry mergers and acquisitions,one is to obtain higher economic benefits,the other is to better achieve industrial structure upgrading.XK company has carried out many cross-industry m&a cases from 2013 to 2018,among which the m&a of film and television industry is the main target.The two most representative m&a cases are XA and MH.The forms of the two cross-border mergers and acquisitions are different,but they are both for the purpose of realizing the company's development strategy,realizing complementary resource advantages and creating enterprise value.At the same time,both mergers and acquisitions have the same motivation and high valuation characteristics.Through the HHM(hierarchical holographic model)framework,the risks in each key link of the merger and acquisition process are identified.It can be seen from the results of risk evaluation that XK company will have obvious short-term wealth effect in the capital market whether it carries out mergers and acquisitions of MH or XA,but it cannot perform ideal financial performance,and there are many risks such as wrong selection of subject,impairment of goodwill,and continuous poor operation.In the process of merger and reorganization,there is a great difference between asset-light enterprises and asset-heavy enterprises,which is embodied in the pricing and valuation of the target companies.For high valuation premium to bring high reputation,is likely to be suspended in enterprise on the head of a ticking time bomb,about high about the consequences of goodwill,formation causes and preventive measures,the light asset merger and acquisition of traditional industry enterprise is analyzed from the specific comb,XK company light asset merger and acquisition of risk and research its corresponding prevention strategies.It is suggested that XK company should reasonably choose the target enterprise of merger and acquisition,choose the appropriate financing method,strengthen the integration after merger and prevent the risk of goodwill impairment,so as to ensure the good effect of merger and acquisition.For external risks,we should also deal with them by rational use of comprehensive risk management means.In the study of m&a cases,this paper further identified the m&a risks of XK company,and then proposed countermeasures against these risks.Next,it summarized the experienceof m&a and its shortcomings,so as to better guide the asset-light m&a of traditional industries.There will be more new characteristics of Chinese traditional enterprises when they carry out asset-light mergers and acquisitions,so they should make better use of merger and acquisition strategies and further integrate merger and acquisition programs to achieve better merger and acquisition effects and better development of enterprises.