| Under the tide of information technology revolution,the semiconductor industry has played a more and more important role.The production of all kinds of intelligent devices and the manufacture of cutting-edge military equipment are inseparable from the development of the semiconductor industry.According to the data of the Global Semiconductor Trade Statistics Association(WSTS),the global semiconductor sales exceeded $500 billion for the first time in 2021,reaching $555.9 billion.China’s total semiconductor sales amounted to US$192.5 billion,accounting for 34.6% of the global market.It has become the world’s largest semiconductor market for many years.However,China’s semiconductor industry started late and developed unevenly,we still have an obvious gap in the overall technical level with western advanced countries.Because of the existence of industry barriers and the occurrence of Sino US trade war,the industry as a whole is in an embarrassing situation of being "stuck".In order to get out of the trouble,China’s semiconductor enterprises gradually began to choose to acquire advanced technology and development ability through M&A,which is far larger than their own enterprises.Many M&A cases show more and more obvious characteristics of "snake swallowing elephant".For example,in 2015,Jiangsu Changjiang Electronics Technology technology acquired STATS Chip PAC,whose scale was twice larger than itself,and in 2020,Wintech acquired Nexperia,a global industry leader whose scale was several times as large as itself.The short-term benefits of this model of M&A are indeed considerable,but the severe financial risks and high failure rate can not be ignored.Therefore,it is very necessary to study the financial risks faced by China’s semiconductor enterprises in the "snake swallowing elephant" M&A,and put forward the corresponding control and preventive measures.This paper mainly adopts the case analysis method,based on China’s semiconductor industry,which is also on the basis of sorting out the relevant documents such as "snake swallowing elephant" M&A,financial risk of M&A and risk control,and takes Weill’s M&A of Omnivision as an example,and makes an in-depth study on all kinds of financial risks faced in the process of "snake swallowing elephant" M&A according to the logical sequence of "definition analysis evaluation control" of financial risk.Firstly,this paper defines the concept of "snake swallowing elephant" M&A and its financial risk,and expounds the relevant theoretical basis.Then,the semiconductor industry is introduced and analyzed,and the relevant background,industry overview and development status are introduced.Besides,it introduces and reviews the specific situation of Weill’s acquisition of Omnivision,re combs the whole M&A process,and summarizes the causes of M&A.Next,after the qualitative analysis of the three dimensions of pricing risk before M&A,financing risk in M&A and integration risk after M&A,this paper makes a quantitative analysis of each financial risk by using the combination of analytic hierarchy process(AHP)and fuzzy comprehensive evaluation method(FCE),supplemented by Delphi method,and obtains the main risk points and evaluation scores of Will’s M&A of Omnivision.Then,based on the specific risk status of each risk point and the relevant analysis above,this paper puts forward targeted control and prevention suggestions for the financial risk of Will and other semiconductor enterprises in China in the "snake swallowing elephant" M&A.Finally,it summarizes and reflects on the article,and looks forward to the prospect of the industry.Through the research,we can understand the financial risk of "snake swallowing elephant" M&A from three dimensions: pricing risk,financing risk and integration risk according to the logical order of M&A.The risk weight of each dimension is different.The financing risk weight is slightly higher than the pricing risk,and the integration risk weight is the largest,nearly 50%.In addition,for the specific risks of different dimensions,enterprises need to adopt different control measures.It mainly includes: firstly,improve the bargaining power before M&A,scientifically select the pricing method and rationally select the target enterprise to prevent the pricing risk caused by excessive valuation premium;secondly,scientifically determine the financing structure and properly select the payment method to ensure that the solvency after M&A is at a safe level to avoid financing risks;thirdly,strengthen business integration,promote the coordinated development of business and enhance employees’ recognition of corporate culture to give full play to the synergy,so as to control the integration risk. |
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