Financial Due Diligence Case Study Over Strategic M&A Between Listed Company A And Private Enterprise B

Review and Prospect of Chinese M&A Market in 2016 released by PricewaterhouseCoopers shows that Chinese M&A cases has reached 11409 in 2016,breaking the record both in quantity and amounts.This is the times of M&A,where service innovation,resources exchange,and benefit sharing could take place through merger integration.M&A integration is the strategic way to spur economic structural adjustment and sustainable development.As the primary solution for eliminating M&A risks,due diligence provides an important guarantee for success of M&A,where the financial due diligence serves an indispensable part.Though many scholars recommend that it is of highest kind to combine financial due diligence with strategy,relevant cases and actual practice experience could not be found.Therefore,the thesis discusses about the meaning,process,procedure,discipline,and methods of financial due diligence oriented by strategic M&A target,taking into account company resources theory,and explains how to choose matching strategic resources and conduct financial due diligence research accordingly.The article looks into financial due diligence practice oriented by strategic M&A target through studying the merger case between listed company A and private enterprise company B.It analyses strategic reasons for company merger and acquisition,and figures out strategically suitable resources,including channel resources,production resource and brand resources,in both parties,as well as emphasizes the validation of the quality for chosen resources in financial due diligence.The financial status of the target company and the resources is then strategically verified through checking the connection between resources and operation practice,and between latter and company’s financial data.Consequently,on one hand,important references are provided to see if the M&A should continue,and on the other hand,new ideas and choices are available for M&A practice.