Research On The Affect And Risk Control Of Performance Compensation Of Internet Enterprises

With the update and iteration of science and technology,the Internet industry quickly swept the world,changing people's lives because of the monopoly characteristics of Internet companies,the impetus behind capital,and the need for traditional enterprises to be internet-based,so mergers and acquisitions of Internet companies become a trend.This paper reviews the background of performance compensation commitment and related theory of literature at home and abroad,summarized performance compensation commitment of acquisition of price adjustment mechanism,reduce the risk of mergers and acquisitions to protect the role of the assignee,but also could push up after m&a premium,through the introduction of the characteristics of the Internet industry,including the reason of m&a tide stage of development,and higher valuation difficult operating leverage assets in the table is low,income is influenced by users,affected by the market and technology affect the iteration,management risk higher As a result,the acquisition of Internet companies is more likely to appear a premium,even when the fair valuation may fail due to the later period of high operational risk,so the use of performance compensation commitment is conducive to reduce the risk of mergers and acquisitions,and can also stimulate the management of the target companies.However,China began to use performance compensation commitment in 2008,The rules are not perfect,and they pose new risks.This paper letter Shanghai secco artisan giada m&a cases as the breakthrough point,through the introduction this case background of m&a motivation situation of mergers and acquisitions through mergers and acquisitions between the two sides promised compensation for the price performance conventions and the result of the merger,to analyze the role of performance compensation commitment and produced some of the risk analysis found that due to valuation difficult and both sides benefit,performance commitment may push up the premium,high management risk are more prone to losses,followed is huge compensation,leading to licensor or,at the same time performance pledge shall be short-term behavior,and may also bring the fords the tax risk Therefore,in order to make better use of the performance compensation promise to reduce the risk of m&a in Internet enterprises,it is necessary to carefully investigate the target enterprises before m&a and appropriately extend the unlocking period to strengthen the internal audit.