Research On The Financial Risks Of High-premium Mergers And Acquisitions

With the continuous strengthening of China's reform efforts,more and more enterprises have achieved the transformation and upgrading of enterprises through mergers and acquisitions.In the wave of mergers and acquisitions in recent years,the phenomenon of high-value mergers and acquisitions has gradually become a hot issue in China's capital market.However,as the phenomenon of premium mergers and acquisitions has become more common,the risk of highvalue mergers and acquisitions has also become increasingly prominent.Many companies choose high-value mergers and acquisitions to expand their own development strategies.While pursuing benefits,they often overlook the risks.High-value mergers and acquisitions often bring a heavy financial burden to the acquirers,and many acquired companies after the merger.The performance level cannot achieve the promised performance,which will have a negative impact on the acquirer.On the basis of reading a large number of related literatures at home and abroad,this paper based on the theory of synergy effect,information asymmetry theory,conceited hypothesis theory and financial risk management related theory,selects the case of the acquisition of Tianma Time and Space by Ourpalm.This paper introduces the basic situation of the merger and acquisition companies and the M&A events,mainly analyzes the reasons for the high premium arising from the three aspects of industry characteristics,the interests of the acquirer and the target asset evaluation method,and then evaluates the risk and financing from the target company.Investigate the financial risks of high-value mergers and acquisitions in terms of payment risk,asset integration risk and goodwill impairment risk.Based on the above analysis,the main problems of the acquisition of Tianma Time and Space in the high premium of Ourpalm are that the underlying assets are overvalued,the original shareholder control is diluted,the asset integration after the merger is not in place,and the business performance of the postmerger is not expected.On this basis,this paper puts forward control suggestions for the financial risk of M&A in this case.It is believed that Ourpalm should reasonably assess the value of the target company,optimize financing payment methods,implement financial and business strategy integration,and improve the design of the gambling agreement.Finally,based on the above analysis,it is concluded that although the acquisition of the company has achieved the growth of the company's scale and profitability in a short period of time,the synergy effect has been achieved to a certain extent,but Tianma Time and Space has been acquired at a premium rate of 32.56 times.Whether Ourpalm can achieve sustainable development and how to control the risks in the M&A process is worth exploring.At the same time,based on the analysis and control research of financial risk in mergers and acquisitions in this case,it provides suggestions for the high-price M&A behavior of China's information technology industry.