Research On Financial Risk Assessment And Evasion Strategy Of M&A In Internet Enterprises In China

In the context of today's highly developed Internet technology,the Internet industry has ushered in an unprecedented development climax.The phenomenon of mergers and acquisitions of “big fish eat small fish” and “strong alliance” in the industry seems to have become a trend.Taking BAT as the head,it has set off waves of mergers and acquisitions.However,some enterprises are only irrational mergers and acquisitions that are blindly chasing the trend.They do not fully realize the many risks in the process of mergers and acquisitions,especially the financial risks,which ultimately lead to the failure of mergers and acquisitions.Based on the previous studies,this paper first explains the connotation of financial risk of M&A,and then combines China's special economic system and the characteristics of the Internet industry to further analyze the types and special characteristics of M&A financial risks in the Internet industry,and based on mergers and acquisitions.The business process divides it into four categories: pricing risk,financing risk,payment risk and financial integration risk,and then analyzes the causes of these four major risks.Secondly,it is the empirical part of this paper.This paper uses the principal component analysis method to evaluate the financial risk of Internet enterprises.Fifty-nine Internet listed companies in China are selected as research samples.Referring to the criteria for selecting financial indicators in other literature,and considering the characteristics of the Internet industry,the financial indicators that are not suitable for the Internet industry in traditional industries are eliminated,from the aspects of solvency,profitability,and so on.12 indicators are selected from the four dimensions of operation ability and development ability,and the Z-value evaluation model of financial risk of Internet enterprises is obtained.The model is used to distinguish the two groups of data of mergers and acquisitions and no mergers and acquisitions.It is concluded that Internet enterprises with mergers and acquisitions have higher financial risks.In order to further judge the impact of mergers and acquisitions on the financial risk of Internet enterprises,this paper returns through OLS.It concludes that M&A has a significant impact on the financial risk of Internet enterprises,and has a negative correlation.Finally,the paper puts forward corresponding measures to avoid the four major financial risks faced by Chinese Internet enterprises in M&A,including due diligence before M&A,selection of appropriate valuation and pricing model to reduce pricing risk,appropriate broadening and selection of appropriate financing channels to reduce financing risk,and reduction of payment risk by installment payment and reasonable arrangement of payment time to reduce fund occupation.Finally,it evades the risk of financial integration by establishing financial integration mechanism and reintegrating assets and liabilities.The innovation of this paper is to construct a new financial risk assessment model of the Internet industry by using quantitative analysis method,and draw the conclusion that the impact of M&A of the Internet industry on enterprise financial risk through panel regression model.At the same time,the conclusion that the Internet industry should pay more attention to its profitability in the process of M&A is drawn.According to the value of Z,we can judge the financial risk of M&A of Internet enterprises.It provides a simple and feasible method for evaluating the financial risk of M&A of Internet enterprises.It also gets rid of the subjectivity of the method of case analysis in the past,so as to provide some reference for the decision-making of M&A of Internet enterprises in China.