The Case Study Of Risk Management In Horizontal Merger And Acquisition Of Jiangte Electric Machinery Company

In recent years,the expansion of China’s economic aggregate has accelerated the growth of total oil consumption,and the contradiction between supply and demand of nonrenewable energy is prominent.Developing new energy vehicles has become an important measure to solve pollution and energy consumption.Therefore,the 12 th Five-Year National Development Plan has established new energy vehicle industry as a strategic emerging industry in China,emphasizing that it will become the leading industry of national economy by the end of 2020.The new energy automobile industry has become the focus of national policy,the government has issued a series of related policies to guide and promote the development of the new energy automobile industry.With the rapid development of new energy automobile industry,horizontal mergers and acquisitions occur frequently,it has practical significance to study the risk and control of horizontal mergers and acquisitions of new energy automobile enterprises.On the theoretical level,new energy vehicle is a new industry,domestic and foreign scholars have few relatively research on this field.This paper is helpful to enrich the related literature on horizontal M＆A risk management of new energy vehicle enterprises in theory.Horizontal M＆A is not only an opportunity,but also a challenge for enterprises.With the downward adjustment of industry policy subsidies,many enterprises are facing financial difficulties,M＆A failures occur frequently.How to effectively manage the risks after mergers and acquisitions has become an urgent problem need to be solved.Therefore,this paper selects the typical M＆A failure case in the new energy automobile industry—Jiangte Motor’s M＆A case,analyzes the motivation,process and result of M＆A of Jiangte Motor based on information asymmetry,core competence,M＆A synergy effect and dynamic risk control theory,and then makes a qualitative analysis of the financial risks and non-financial risks arising from M＆A of Jiangte Motor.By constructing the risk evaluation index system of M＆A of Jiangte Motor,Entropy method and analytic hierarchy process are used to quantitatively evaluate the horizontal M＆A risks of enterprises.Finally targeted control suggestions are put forward for the financial and non-financial risks existing in Jiangte Motor’s merger and acquisition of Jiulong Automobile.The contribution of this paper is that,in addition to the research on the general risks of M＆A,it increases the special horizontal M＆A risks of new energy automobile enterprises,including market competition risks and policy risks;The evaluation index system of M＆A risk is innovatively constructed from two aspects of financial risk and non-financial risk,and some qualitative indexes in the previous risk evaluation indexes are replaced by quantitative indexes.Combined with entropy method and analytic hierarchy process,the risk evaluation model of horizontal M＆A of new energy vehicles is constructed,and the horizontal risk of Jiangte Motor is comprehensively evaluated,which can provide reference for the control of horizontal M＆A risk of other new energy vehicle enterprises.