Research On Shuanghui Multinational M&A Smithfield Financing Method

With the deepening of financial supply side reform and the accelerating pace of financial opening up,cross-border M & A has become the mainstream trend for Chinese enterprises to go global.With the deepening of economic globalization,more and more enterprises choose cross-border M & A to enhance their strength in order to expand their business.Cross-border M & A is not only an opportunity but also a challenge for enterprises.Cross-border M & A is a very complex and professional enterprise activity,and Financing method is an important factor determining the success of M & A transactions.According to the Research Report of Deloitte Touche Tohmatsu,a famous international accounting firm,53.62% of the reasons for the failure of overseas M & A transactions in 2018 come from the failure of transaction negotiation,39.13% from the discovery of major risks in the process of due diligence,20.29% due to the difficulty of capital exit,the difficulty of capital exit has attracted the attention of enterprises and become one of the main obstacles of cross-border M & A,which shows that the failure of M & A caused by financing problems has already occurred It has become the pain point of overseas M & A.By analyzing the background of the topic and the current situation of research at home and abroad,this paper summarizes the related theories of cross-border M & A financing mode.This paper expounds and analyzes the process and motivation of the case of Smithfield M & A of Shuanghui international.This paper makes an in-depth analysis of the financing mode,selection of financing mode,financing risk and financing effect of Shuanghui international.The conclusion is as follows: M & A financing mode is the key to the successful implementation of cross-border M & A.There are various factors that determine the financing mode,and improper decision-making of capital structure,financial leverage and payment mode may lead to M & A a failure.Smithfield's equity is relatively scattered,and shareholders tend to obtain immediate income by cash payment,which urges Shuanghui to choose debt financing;Shuanghui uses leverage financing toreduce financing cost and tax burden when it conducts merger and acquisition;in order to shorten the time of merger and acquisition,Shuanghui uses cash payment to promote debt financing.It is proposed that enterprises should flexibly use financing tools to finance cross-border M & A,reasonably choose financing methods considering their own and external environmental factors;improve the participation of intermediary institutions in cross-border M & A financing;make full use of domestic and foreign capital markets to expand financing channels;enterprises should use specialized teams to predict and prevent financing risks,and establish M & A The early warning mechanism of financing risk can reduce the financing risk of M & A.